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China absorbed the shock by drawing on stockpiles and a decade of electrification. Europe needs electrification for security, but it needs to decide which parts of the system it is willing to buy from Beijing.
Resources are no longer ‘king’ when it comes to energy, wrote Zhao Hongtu and Chen Wenlin in the 1 September 2026 edition of Qiushi, the Chinese Communist Party’s flagship theoretical journal. Mineral-rich economies may have some leverage, but the countries that control ‘transition-related technology, finance and rules’ will gain more influence as the world sees the rise of the ‘electrostate’, with ‘China, India and Brazil becoming the main force of new energy development.’
As a result of the US-Israeli war on Iran, argue Zhao and Chen, energy security has become a priority in national policymaking: ‘clean energy is seen as an important route to security’ and ‘economies that actively embrace the energy transition may occupy more important positions in the future global energy landscape.’
It is unsurprising that a CCP journal would commend China’s efforts in building renewable energy and managing the fallout of the Iran war. But the numbers support their conclusions. The oil importer most exposed to the crisis in the Strait of Hormuz – China imports 70 per cent of its oil, around half of it from the Gulf – has also been the least disrupted.
Weathering the storm
China’s strength in weathering the Hormuz crisis so far stands in contrast to much of the world.
The crisis pushed the 32 members of the International Energy Agency (spanning the oil importers of the rich world) to carry out their largest-ever emergency stock release, aimed at stopping oil prices from spiralling further. They released more than 400 million barrels in total, including 172 million from the US Strategic Petroleum Reserve, to replace some of the 20 million barrels per day (b/d) that had been passing through Hormuz.
China needed no such collective effort. Beijing entered the crisis with an estimated 1.4 billion barrels in storage: around 360 million in government reserves and the rest in commercial tanks, totalling at least three months of imports.
In response to Hormuz, China diversified its imports: roughly one-third of the barrels it lost from the Gulf were replaced from elsewhere, such as Brazil, according to the Asia Group.
The rest of these lost imports went unreplaced: China’s crude imports fell by a third, from 12 million b/d on the eve of the war to less than 8 million b/d in May and June.
About 60 per cent of the shortfall from unreplaced imports was met from storage. The rest was not met; instead, there was a real fall in the amount of oil China burned. Refineries cut their crude runs and Beijing ordered the big state refiners to halt fuel exports so that what they did produce stayed at home.
Electrification and security
China was able to survive this fall in oil consumption due to the electrification of its economy. An electrified economy can use less oil without using less transport. Electric vehicles accounted for more than 60 per cent of domestic monthly vehicle sales in the first half of 2026. Drivers of conventional automobiles reportedly switched to electric ride-hailing.
Chinese clean technology has been manufactured and deployed at scales that have driven the cost of equipment down substantially. China leads the world in renewable power installation. In the first half of 2026, China added more wind capacity than in any full calendar year before 2025.
This resilience is not a happy coincidence or an unintended benefit of climate policy. The Hormuz crisis validated long-term strategic concerns in China. Back in 2003, CCP General Secretary Hu Jintao coined the term ‘Malacca Dilemma,’ referring to the energy chokepoint in the Strait of Malacca. Since then, energy security has underpinned Beijing’s low-carbon industrial strategy.
China’s 15th Five Year Plan (2026-2030), adopted in March, formalized this green energy statecraft. As analyst Lu Ruquan summarizes, the plan’s energy framework aims to provide China with the energy security needed to weather crises by ‘increasing oil and gas reserves and production, stabilizing annual crude oil output at 200 million tonnes, replacing petroleum consumption, and securing the supply of critical mineral resources for new energy.’
The plan’s approach is convincing. Within this, electrification helps governments to hedge against volatile pricing, a weaponized dollar, and an increasingly uncertain geopolitical environment.
China’s dominance of renewables
This is particularly clear for Asian economies increasingly embracing renewables. Indonesia’s president, for example, has pushed for an all-electric transport transition to reduce import reliance.
Southeast Asian nations have spent over $20 billion on Chinese-made clean-tech products so far in 2026, according to a recent Reuters analysis citing the think-tank Ember. China makes much of the hardware used in renewable projects, such as panels, inverters, turbines or battery storage.
In 2024, China produced more than 90 per cent of the polysilicon, wafers and cells, and 86 per cent of the modules needed for solar energy globally. The figures are similar in other industries like batteries, where graphite and anode active materials, for example, are largely concentrated in Chinese supply chains.
China is also financing green energy at record levels across the Global South, totalling approximately $20.1 billion in the first half of 2026, more than all of 2025.
Different dependencies
But for middle powers, this security hedge is double edged. While the transition away from oil and gas can help protect against energy shocks, the concentration of clean technology in China could leave states dependent on Beijing.
The green transition is reliant on critical minerals and rare earths. For many of these materials, China controls much of the global refining and mining, giving Beijing an effective tool of statecraft. For example, Beijing halted exports of rare earths to Japan in January amid rising tensions between the two countries related to Taiwan.
Similarly, China could leverage its dominance in the production of solar panels, EVs and other green technologies.
This risk is different to that of relying on fossil fuels. Disruptions to oil and gas have an immediate impact that can be felt in higher prices. No navy can blockade the sun or wind.
But depending on China’s low-carbon technologies and critical inputs may impact countries’ ability to implement the green transition more broadly, rather than hitting short-term supply.
Europe needs to think strategically
This is increasingly recognized in Europe. ‘We still have too many dangerous dependencies,’ said European Commission president Ursula von der Leyen in her State of the Union on Wednesday. ‘We are more than 80 per cent dependent on China for many critical raw materials. 90 per cent for some rare earths… We need to urgently procure and build up our reserves.’
This autumn, EU officials will face this reality as they attempt to settle the bloc’s trade posture towards China and the final shape of the Industrial Accelerator Act rules, aimed at boosting European manufacturing. The UK faces a similarly complex set of questions around competition, security and decarbonization.
Europe should not slow its transition. Instead, China’s example highlights Europe’s need to embrace its own green energy statecraft. Europe needs to accelerate diversification and reduce exposure to chokepoints – whether in fossil fuels or other energy-related supply chains. That does not mean rebuilding the whole supply chain. It means being selective, as Europe has demonstrated by tightening the rules around critical components like inverters.
Done right, this should not only reduce Europe’s vulnerability to Chinese supply weaponization, but also hedge against US policy volatility and potential political interference. European officials and experts have warned, for example, that the Trump administration could potentially seek to use Europe’s dependency on US gas as leverage to dictate terms over issues like Greenland or tariffs.
Perhaps it’s time for Europe to think about its own sources of leverage. It may yet need to deploy them as geoeconomic deterrence. Both the US and China have shown they will use supply as a weapon; a Europe that cannot answer in kind will have its energy choices made for it.