Lauri Myllyvirta

Read the full article here: carbonbrief.org/analysis-china…

The article argues that the Hormuz crisis could result in China following a lower-CO2 trajectory than previously expected, if key policies in its 15th five-year plan are fully implemented.

NEW from me: China’s carbon dioxide (CO2) emissions grew by 2% in the first quarter of 2026, with power sector emissions rising 4%, after a rise in the amount of “wasted” wind and solar power. Emissions remain below the peak in early 2024.

@Rory_Johnston February vs current prices.

@Rory_Johnston Gasoline and diesel prices are up 25-30% from February. Not full pass through but far from fully shielded. qiyoujiage.com

It makes sense that Chinese refineries have cut runs (and thus imports) given the margin implosion. It makes less sense that we'd see acute demand destruction across Chinese consumers shielded from global price spikes by caps on domestic pump prices. Reuters:

@tylermacro10 A couple of years sounded reasonable but even three or four years doesn't do anything for the economics of investing in new energy production.

@laurimyllyvirta I see. Isn’t that in for years?

Worth thinking through the implications - once Hormuz traffic is back and tanks are filled up, you have an oversupplied fossil fuel market but with ever present risk of a new shock. Boon for investments that cut price risk, poison for ones depending on high OR low fossil prices.