China's shrinking appetite for oil is balancing global crude markets: China's crude oil imports are tracking at ~6.6 million barrels per day so far in May, the lowest since 2016/ This comes as oil inbound shipments fell -20% MoM in April, to 9.37 million barrels per day, the lowest since July 2022. This compares to 11.6 million barrels per day in 2025, when the country was aggressively stockpiling to bolster energy security. China’s crude oil imports are now expected to average 10.9 million barrels per day in 2026, the lowest average for any year since 2022. However, China's oil inventories have declined by only ~20 million barrels over the last several weeks, to ~1.23 billion barrels, still +15% above early 2025 levels. Over the prior 2 years, the country’s stockpiling absorbed much of the world's surplus oil and helped support global prices, but this dynamic has now reversed and is capping any further upside. China is effectively putting a ceiling on oil price gains despite severe supply shortages.(The Kobeissi Letter)