China will buy more U.S. crude oil, says Energy Secretary Wright

China will ramp its crude oil imports from the United States because the world’s two largest economies are natural trade partners when it comes to energy, Chris Wright told CNBC on Friday.

China is the largest oil importer in the world and the U.S. is the biggest producer. “There’s a natural energy trade there,” the U.S. Energy secretary told CNBC’s Brian Sullivan in an interview in Port Arthur, Texas.

China relies heavily on the Middle East for its oil imports. Exports from the Persian Gulf have mostly been cut off for weeks now due to Iran’s blockade of the Strait of Hormuz. Beijing has a massive strategic reserve that has helped it weather disruption so far.

“I suspect we’ll see a growth in their oil imports from the United States,” Wright told CNBC.

China and other Asian buyers will eventually buy more oil from Alaska as the Trump administration ramps up production there, Wright said. For now, Beijing will import more oil from the U.S. Gulf Coast, he said.

President Donald Trump told Fox News earlier that China had agreed to buy more oil from the U.S. Beijing so far has not confirmed whether there is such an agreement with the U.S.

“They’ve agreed they want to buy oil from the United States, they’re going to go to Texas, we’re going to start sending Chinese ships to Texas and to Louisiana and to Alaska,” Trump told Fox News. The U.S. president met with President Xi Jinping for a summit in Beijing this week.

Hormuz will lose its importance: Wright

Hormuz will decline in significance due to Iran’s blockade of the sea lane, Wright said. “This is a card you can play once,” the Energy secretary said of Iran’s disruption to the strait.

About 20% of world oil supplies passed through the sea lane before the U.S. and Israel attacked Iran on Feb. 28. Iran’s blockade of Hormuz in response has triggered the largest energy supply disruption in history and deeply impacted the economies of the Gulf Arab states.

The Gulf states will build more pipelines to bypass Hormuz after the war, Wright said. The United Arab Emirates already plans to accelerate the construction of a new West-East pipeline that bypasses Hormuz.

“There’ll be other routes for energy to get out of the Persian Gulf,” Wright said. “We will see a decreasing importance from the Strait of Hormuz, but not a decreasing importance of those nations’ energy production and energy supply.”