China's imports of crude oil and exports of refined products neatly capture the current dynamics of the conflict in the Middle East. There is plenty of crude, but not enough fuel.
The world's biggest crude importer recorded arrivals of 9.88 million barrels per day (bpd) in October, according to customs data released on Tuesday.
This was up 9.4 per cent from September's 9.03 million bpd and the most since March's 11.77 million bpd.
March was the last month largely unaffected by the conflict in the Middle East, which started on February 28 when the US and Israel launched strikes against Iran.
The war led to the effective closure of the Strait of Hormuz, which strangled crude and product exports from the Middle East.
Asian importers were the destination for about 80 per cent of oil exports through the narrow waterway, which carried about 20 per cent of the global total prior to the start of the conflict.
China's crude imports dropped to a 10-year low of 7.12 million bpd in June, but they have steadily risen since then as Persian Gulf exporters shipped more oil, calculating that the higher prices on offer offset the risk of attacks on vessels by Iran in the Strait of Hormuz, and by Tehran's Houthi allies in the Red Sea.
China's crude imports from the Middle East are back to pre-war levels, with commodity analysts Kpler tracking arrivals of 4.65 million bpd from the region in October, the same as for March.
It is worth noting that even though October was the strongest month for China's oil imports since March, they were still down 13.3 per cent from the same month in 2025, and for the first 10 months of the year, arrivals have slid 15.1 per cent.
This means that China has been adjusting to reduced imports, and while it has dipped into stockpiles, the main method of compensating has been to cut exports of refined products.
Fuel exports were 5.18 million tonnes in October, down from 7.16 million in September, according to customs data. They had dropped to 3.12 million tonnes in April, the weakest since January 2017.
China is one of the few countries in the world with spare refining capacity, but refiners have to secure quotas to sell overseas, meaning exports are not driven by market dynamics.
Refiners were told to cut back on exports in the initial months of the Iran conflict in order to ensure domestic supplies, although these restrictions were relaxed to allow refiners to take advantage of the huge margins on offer, especially for diesel.
China's exports of diesel climbed to the highest in nearly three years in September, with Kpler showing shipments of 500,000 bpd.
But October exports of diesel dropped to 318,000 bpd and Kpler data suggests November will be weaker, with only 62,000 bpd tracked so far, although this number will rise as more cargoes are assessed prior to the end of the month.
China's refining system is operating at less than 80 per cent of capacity, meaning it has the ability to ramp up exports, although this would mean either importing more crude or using up inventories, or a combination of both.
It would certainly be highly profitable for China's refiners if they were allowed to export more fuels, with the Singapore profit margin on a barrel of gasoil, the building block for diesel, ending at $60.46 a barrel on Monday, about three times the $20.91 on the day before the Iran war started.
(By Clyde Russell, Editing by Sonali Paul)