Xi Jinping in massive trouble as Iran war disrupts China’s oil supply, fuel prices spike twice in 13 days, petrol, diesel now cost…

The Xi Jinping-led China government had also increased fuel prices on March 9. At that time, petrol prices were raised by 695 yuan per ton, while diesel prices were increased by 670 yuan per ton.

New Delhi: In a significant development, the Iran war impact has now reached China. The Xi Jinping government has increased the fuel prices in China for the second time in March. The officials have raised retail prices of petrol and diesel as part of preparations for a potential fuel crisis. It is important to note that this step has been taken amid concerns that a prolonged US–Israel–Iran conflict could lead to shortages of gasoline and diesel.

The National Development and Reform Commission (NDRC), China’s top planning body, announced temporary measures starting Tuesday in response to rising international oil prices. In its statement, the NDRC said these measures are aimed at reducing the impact of abnormal spikes in global oil prices, easing the burden on consumers, stabilizing the economy, and ensuring social security.

Due to the ongoing conflict in West Asia, the Strait of Hormuz has been disrupted. The Strait of Hormuz is a key maritime route through which about 20 percent of the world’s energy supplies are transported.

The Xi Jinping-led China government had also increased fuel prices on March 9. At that time, petrol prices were raised by 695 yuan per ton, while diesel prices were increased by 670 yuan per ton. This translated to roughly 0.53 to 0.57 yuan per liter at the pump.

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Here are some of the key details:

China on Monday increased petrol (gasoline) prices by 1,160 yuan (about $168) per ton
The Xi Jinping government raised the diesel prices by 1,115 yuan (about $159) per ton.
Typically, 1 ton (1,000 kilograms) of diesel contains around 1,136 to 1,220 liters
While 1 ton of petrol contains about 1,300 to 1,400 liters.
Following the announcement of the fuel price hike, vehicle owners across China rushed to gas stations to fill up their tanks.
China depends on imports for around 70 percent of its crude oil needs, and about 45% of those imports pass through the Strait of Hormuz.

Impact of the Iran war on China

The escalating tensions in Iran have primarily affected China in terms of energy security, trade, diplomacy, and global supply chains. Notably, China has been the largest buyer of Iranian oil, so the war has increased uncertainty in oil supplies, forcing it to look for alternative sources such as Saudi Arabia and Russia. This has led to higher energy costs and added inflationary pressure.

China has invested over $100 billion in energy and infrastructure projects in Iran. If the conflict drags on, these projects could be at risk.

Tensions in the Strait of Hormuz have disrupted shipping and oil transportation, affecting not only consumer supplies but also industrial supply chains heading to China.

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