On the contrary, conserving strategic reserves and letting prices spike in the short term may bring long-term benefits
3-MIN READ3-MINAndy XieDr Andy Xie is a Shanghai-based independent economist specialising in China and Asia, and writes, speaks and consults on global economics and financial markets. Published: 5:30am, 21 Jul 2026Oil prices are set to rise once more as renewed US attacks on Iran leave the Strait of Hormuz, a major artery of oil trade, closed again. With US strategic petroleum reserves at their lowest in over 40 years, America will have trouble keeping oil prices below US$100 a barrel, as it has mostly done in the war so far.Analysts warn that sustained oil prices above US$100 risk accelerating inflation, depressing consumption and inviting recession. They have also turned their attention to China and its ability to cushion oil prices.
But recent talk of Beijing withdrawing the “safety net” or “cushion” for oil prices appears to be laying the groundwork for blaming China when prices rise – which they are likely to do.
