‘We’ve been free-riding off Beijing in a weird way’ — Oil prices are high but could be much worse. Trump has China’s Xi to thank for that

Oil prices have remained high despite the ongoing conflict in Iran, but they could be much worse. President Donald Trump's war against Iran has not yet triggered the dire price projections initially feared. Chinese President Xi Jinping's strategy, which includes a massive oil stockpile, has helped mitigate the impact on China. China built up the world's largest oil reserve, reaching 1.4 billion barrels by the end of last year, to protect itself against foreign supply risks.

The reserve enabled China to significantly reduce crude imports after U.S. and Israeli attacks on Iran and the closure of the Strait of Hormuz. China's increased use of electric vehicles and diversification into other energy sources also contributed to its resilience. However, the country now faces new challenges, like the attacks by Iran-backed militias that temporarily shut down a vital pipeline in Saudi Arabia.

If the violence persists, oil prices could reach $95 to $120 per barrel or even $150 per barrel, causing serious global economic disruption.