Systemic risks analysis in international crude oil market: Evidence and countermeasures

Crude oil, often referred to as the “lifeblood” of the modern economy, plays a pivotal role in global economic stability and energy security. However, with the recurrence of crises in recent years, such as the the Russia-Ukraine conflict, escalating tensions in the Middle East, and intensifying trade frictions, the international crude oil market has been facing complex systemic risks, which are accelerated by persistent geopolitical conflicts, fragile supply-demand structures, and the intertwining of macroeconomic and financial uncertainties and so on. For China, with crude oil import dependence remaining above 70% for a prolonged period, economic and social development faces the dual challenge of high external risk exposure and insufficient internal resilience. Against this backdrop, systemic risks in the crude oil market are more likely to transmit to the domestic economy through trade, industrial and financial chains, posing severe challenges to China’s energy security and high-quality economic and social development. Therefore, from the perspective of systemic risk, this study identifies the major sources and evolutionary patterns of risks in the crude oil market, and analyzes their transmission mechanisms and potential impacts on China. Furthermore, this study proposes targeted policy responses focused on the key issues, namely, strengthening the financial risk management framework for the oil sector, balancing economic stability with the green and low-carbon energy transition, enhancing autonomy and controllability in energy security, and deepening international cooperation to enhance China’s pricing power in global energy markets.