As you can see from the output below, the only correct input for --expiry is 2018-01-01T00:00Z All other input format which I thought is correct failed.
az storage container policy create -c hasontestsetacl -n acl3 --expiry 2018/1/1 --permissions r
az storage container policy create: error: argument --expiry: invalid datetime_string_type value: '2018/1/1'
az storage container policy create -c hasontestsetacl -n acl3 --expiry 2018-1-1 --permissions r
az storage container policy create: error: argument --expiry: invalid datetime_string_type value: '2018-1-1'
az storage container policy create -c hasontestsetacl -n acl3 --expiry 2018-01-01T00:00:00Z --permissions r
az storage container policy create: error: argument --expiry: invalid datetime_string_type value: '2018-01-01T00:00:00Z'
az storage container policy create -c hasontestsetacl -n acl3 --expiry 2018-01-01T00:00Z --permissions r
SUCCESS