Oil Prices Continue to Rise in May

From a global perspective, the oil price surge in May did not escalate into an out-of-control energy crisis, primarily due to the contrasting yet complementary roles played by China and the United States.

Supply Side: The US Acts as a "Super Seller"

With the world losing over 12 million barrels of Middle Eastern supply daily, the US became the main force filling the gap by massively releasing strategic petroleum reserves and increasing exports.

Unprecedented Export Volume: Over the past four weeks, US net exports of crude oil and refined products averaged a staggering 5.9 million barrels per day, almost double that of the same period last year. In April alone, Asian buyers snapped up US crude oil, causing exports to surge to approximately 5.2 million barrels per day.

Rapid Depletion of Reserves: This high-intensity output relies heavily on depleting strategic petroleum reserves, with weekly releases exceeding 1.23 million barrels per day, setting a historical record.

Demand Side: China Uses Reserves to "Restrain Imports"

Unlike the US's "increasing supply," China primarily alleviated global pressure through "reducing demand," namely, significantly decreasing its purchases of high-priced crude oil on the international market.

Significant Decline in Imports: Of the 10.9 million barrels per day decrease in global net seaborne oil imports, China alone contributed approximately 50%, with imports falling from about 14 million barrels per day in the same period last year to about 8.5 million barrels per day.

Utilization of Strategic Reserves: Analysts believe that China's ability to reduce imports is due to the large-scale utilization of its substantial strategic oil reserves to meet domestic demand, effectively providing a significant buffer for the global market.

Profound Impact on Foreign Trade: Oil price fluctuations are profoundly impacting the foreign trade landscape in several ways:

Soaring Logistics Costs: International shipping and domestic logistics costs have surged along with oil prices. Profit margins for foreign trade enterprises, especially exporters of low-value-added products reliant on sea freight, have been severely squeezed. This increased cost will ultimately be partially passed on to overseas consumers, potentially weakening the price competitiveness of exported products.

Forced Restructuring of Global Supply Chains: Disruptions to Middle Eastern oil supplies have prompted importing countries (especially in Asia) to seek alternative sources globally, primarily turning to the United States and other oil-producing countries in the Americas.

This has led to a dramatic shift in global oil shipping routes, with a surge in demand for tankers from the US to Asia, driving up shipping costs.

Simultaneously, this "going the long way around" procurement model reduces the efficiency and stability of the overall supply chain, posing a challenge to "just-in-time" production models.

Trade Pattern Differentiation:

Energy Exporting Countries: Energy exports from countries like the US and Canada have increased significantly, leading to a widening trade surplus.

Energy Importing Countries: For many countries heavily reliant on oil imports (including many emerging markets and developing economies), rising oil prices mean soaring import costs, leading to deteriorating terms of trade, widening current account deficits, and potentially triggering currency devaluation and debt crises.

Exacerbating Global Inflation and Stagflation Risks: Rising oil prices directly push up the Producer Price Index (PPI) and Consumer Price Index (CPI) in various countries. This imported inflation forces many central banks to tighten monetary policy, but this in turn inhibits economic recovery. The world is facing the risk of stagflation—"economic stagnation + inflation"—which will further weaken overall global demand and shrink the "pie" of foreign trade.