Treasury Secretary Scott Bessent said Friday that China will work behind the scenes to help reopen the Strait of Hormuz.

“I think they’re going to do what they can,” Bessent told CNBC’s Joe Kernen from Beijing, where he had accompanied President Donald Trump to a two-day summit with Chinese leader Xi Jinping. “It’s very much in their interest to get the Strait reopened.”

China is the world’s largest oil importer and the main buyer of sanctioned Iranian crude, which gives Xi unusual leverage over Tehran. It also means a prolonged closure hurts Beijing’s energy security as much as the West’s.

The conflict began in late February, when US and Israeli strikes killed Iran’s Supreme Leader Ayatollah Ali Khamenei. Iran responded by blockading the Strait. Brent crude rose 3.15% to $109 today.

Polymarket Term Structure Tells The Real Story

Polymarket users have wagered almost $14 million on whether Hormuz traffic returns to normal by the end of May. The market gives it under a 6% chance. July 31 is at 46%, and December 31 at 79%.

Traders see a path to eventual resolution by year-end but flatly reject the near-term framing Bessent offered. Capital Economics reportedly modeled crude at $150 per barrel through 2027 in an extreme case, per Reuters.

Why Oil Hasn’t Hit $150 Yet

Saudi Arabia’s East-West pipeline, known as Petroline and built in the 1980s as Hormuz insurance, was running at roughly 3.2 million barrels per day before the war. Within days of the February strikes, Aramco ramped it to full capacity, and in March converted a parallel natural gas pipeline to crude, boosting total throughput from 5 million to 7 million barrels per day. According to Bloomberg, Petroline is “one reason oil prices haven’t reached crisis-level highs.”

The International Energy Agency estimates global spare production capacity at about 4.4 million barrels per day, though more than 75% of that sits inside the Middle East and can’t easily reach buyers while the Strait is blocked.

Exxon Mobil Corp. (NYSE:XOM) and Chevron Corp. (NYSE:CVX) have benefited from the elevated floor, alongside the United States Oil Fund (NYSE:USO), but the supply offsets have kept Brent capped near $110 rather than spiking toward Capital Economics’ extreme case.

Secretary of State Marco Rubio appeared to undercut Bessent’s framing, telling NBC News, “We’re not asking for China’s help. We don’t need their help.”

Raymond James said in a note this week that Beijing is unlikely to “use its influence in a muscular fashion”, given its competing relationships with Iran and other Gulf partners.

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