China's government directed the country's largest oil refiners to immediately suspend exports of diesel and gasoline amid escalating conflict in the Persian Gulf. Officials from the National Development and Reform Commission instructed companies, including PetroChina Co., Sinopec, CNOOC Ltd., Sinochem Group, and private refiner Zhejiang Petrochemical Co., to halt new export contracts and seek cancellations of existing shipments.

The move prioritizes domestic fuel supplies as disruptions in the Strait of Hormuz have halted nearly all oil and fuel tankers from exiting the Persian Gulf. The conflict intensified after U.S. and Israeli strikes on Iran began over the weekend, prompting Iran to restrict access to the strait, a chokepoint for about one-fifth of global oil trade. Now in its sixth day, the war has frozen shipping traffic through the strait.

China relies on the Gulf region for close to half of its oil imports, including nearly all shipments from Iran. The world's top oil importer issued the order earlier this week during a scramble across Asia to secure energy needs. Exceptions apply to jet fuel for international flights, bunker fuel in bonded storage, and supplies destined for Hong Kong and Macau.

China's refining sector mainly serves domestic demand and ranks as Asia's third-largest supplier of seaborne fuel products after South Korea and Singapore. The government allocates annual export quotas for refined products, with 2026 quotas set at 19 million tonnes, similar to the previous year. Early March exports included about 70,000 tons of jet fuel, 35,000 tons of diesel, and 35,000 tons of gasoline, though halting April shipments will have the most immediate effect.

The suspension reflects broader precautions across the region. Indian refiner MRPL declared force majeure on gasoline exports, while Thailand halted crude and petroleum shipments. Refiners from Japan to Indonesia have cut run rates. Global oil prices have surged in response to the supply fears, though China's strategic reserves are said to cover several months of needs.

Beijing has also urged Iran to keep the strait open for energy flows, particularly from Qatar, highlighting its vulnerability despite diversification efforts.