By Abbas Nazil
China is weathering the latest surge in global oil prices better than many countries because of decades of heavy investment in electric vehicles and renewable energy.
As oil prices climbed above $100 a barrel amid escalating tensions in the Middle East and fears of supply disruptions, China has found itself less exposed to the crisis than other major economies.
The country’s growing reliance on electricity-powered transportation and domestically produced energy sources has reduced its vulnerability to sudden spikes in global fuel costs.
Over the past several decades, Beijing invested hundreds of billions of dollars in electric vehicles, solar, wind, hydro and nuclear power to reduce its dependence on imported oil.
As a result, China’s demand for refined oil products such as gasoline and diesel declined last year for the second consecutive year.
Energy analysts now believe the country’s oil consumption may have reached its peak, meaning China’s economy is becoming less sensitive to disruptions in global oil supplies.
The shift is especially evident in China’s automobile market, the largest in the world, where electric vehicles have rapidly replaced gasoline-powered cars.
More electric vehicles were sold in China in 2025 than in the rest of the world combined.
About half of all new cars sold in China are now either fully electric or hybrid vehicles that combine electric power with gasoline engines.
Electric technology is also expanding into freight transportation, with roughly one-third of newly sold heavy-duty trucks operating entirely on electricity.
The rapid transition contrasts sharply with the United States, where about 22 percent of new cars sold in 2025 were hybrid or electric.
Electric vehicle sales in the United States slowed toward the end of the year after a major federal tax credit expired.
China’s progress reflects a long-term strategy designed not only to cut pollution but also to strengthen national energy security.
The effort dates back to concerns raised in the early 2000s about China’s dependence on oil shipments passing through strategic maritime routes such as the Strait of Malacca.
To reduce that vulnerability, the government created large emergency petroleum reserves while aggressively promoting renewable energy and electric transportation.
Today China has the world’s largest electric vehicle charging network and one of the largest renewable energy systems.
However, the country is not completely insulated from global oil shocks.
China still imports about three-quarters of its oil and relies on petroleum products for industries such as petrochemicals that supply materials like polyester and rubber.
When oil prices surged toward $120 recently, Chinese authorities raised retail fuel prices by about five percent, the largest increase in four years.
Long lines formed at gas stations in several Chinese cities as drivers of gasoline-powered cars rushed to fill their tanks before prices climbed even higher.
