Brazil overtakes Iraq in China oil supply shift
Shafaq News- Baghdad
Brazil and Angola posted significant gains in China’s crude oil imports for the first quarter of 2026, at the expense of Iraq and Gulf producers, the Iraq Future Foundation for Economic Studies and Consultations said on Friday.
In a statement, Manar al-Obaidi, head of the foundation, explained that the decline in Iraq’s market share is not solely linked to disruptions in the Strait of Hormuz, but also to structural factors that have strengthened competing suppliers.
“Brazil and Angola offer higher-quality crude with lower sulfur content compared to Iraqi oil, making it more attractive to Chinese refineries seeking to reduce refining costs,” he said, adding that both countries benefit from not being bound by OPEC+ production quotas, a factor that allows them greater flexibility to meet rising Chinese demand and expand their market share.
Shipping security was also cited as a key factor, with routes from South America and Africa seen as more stable and less exposed to tensions affecting Middle Eastern waterways.
Read more: Iraq’s oil bottleneck: Abundance trapped by dependency
Despite Iraq currently holding about 10 percent of China’s oil imports, he warned of a sharp decline expected in April and May, as the full impact of Strait of Hormuz disruptions becomes more evident in second-quarter data.
“The bigger risk lies in the potential long-term entrenchment of this shift,” he cautioned, noting that strong ties between China and countries such as Russia, Brazil, and Angola within the BRICS group could provide them with sustained economic and political advantages.
Al-Obaidi warned that if the crisis continues, “Iraq may struggle to regain its market share even after conditions stabilize, unless it resorts to significant price discounts.”
Read more: Iraq's energy vulnerability: When a petro-state has no buffer
