China’s careful hedging in the Iran war

When it comes to China’s role in the war in Iran, there are two diametrically opposed viewpoints. One view holds that China and Iran, with Russia and North Korea, form an “axis of evil,” and that it is only natural for China to assist Iran. There is even a view within the United States government that attacking Iran would weaken China’s power.

This may be the case; the administration of U.S. President Donald Trump is inclined to downplay Russia’s military support for Iran, while paying close attention to Beijing’s every move. Not long ago, Mr. Trump warned China not to supply weapons to Iran, stating that doing so would have serious consequences.

The second view is that China has abandoned Iran. Aleksandr Dugin, Russian President Vladimir Putin’s “philosopher,” warned Beijing before the war that it must not stand idly by while its ally faces peril; otherwise, when China itself needs assistance, it will not receive help from others. Some naive Western observers have taken Beijing’s so-called neutral stance at face value, concluding that China has abandoned its friend.

Both viewpoints may seem compelling. But for Beijing, what is at stake is not just its alliance with Tehran, but its own domestic economic health, the waning supply of cheap oil and the need to preserve crucial export markets in North America and the Arab countries of the Middle East.

China’s rationale related to the war

Approximately 13 percent of China’s oil imports come from Iran, while China is Iran’s largest trading partner. In terms of investment volume, China’s investment in Iran pales in comparison to its investment in Saudi Arabia and the United Arab Emirates.

As part of the Belt and Road Initiative, Beijing has built a railway that runs through Central Asia to Iran, intended to bypass the Strait of Malacca during times of crisis. Before the war, Iran did not pay much attention to it. However, this railway was damaged by Israeli bombing during the war.

Chinese leaders are averse to internal divisions within Iran, as the Islamic Revolutionary Guard Corps (IRGC), despite not officially holding government positions, often wields more influence than the government itself. During the recent conflict, although Iranian authorities officially granted Chinese ships passage, the IRGC blocked them on several occasions. Yet Beijing does not publicly voice its displeasure.

What worries Chinese President Xi Jinping even more is his country’s own economic problems: How to escape the middle-income trap and ensure export growth amid sluggish domestic consumption. From this perspective, regaining access to the U.S. market is a major priority for Beijing. The May 2026 meeting with President Trump is a crucial step toward this goal. The summit concerns not only China’s economic future but also the Chinese Communist Party’s assessment of President Xi. He hopes that by meeting with President Trump, he can demonstrate that the China he leads is an open, confident nation.

For these reasons, the stance President Xi projects toward President Trump (regardless of formal critiques) is not entirely antagonistic. For example, during the April negotiations between Iran and the U.S. in Pakistan – though the talks themselves were unsuccessful – China did exert pressure on Iran to participate, despite Tehran’s initial reluctance. Mr. Trump expressed his gratitude to Beijing for this. By doing so, Beijing hopes to lay the groundwork to strike a deal with the U.S. on the Taiwan issue – at the very least, to delay or cancel arms supplies to Taipei.

President Xi’s personality also plays a significant role in handling relations with Iran. While Russian President Vladimir Putin’s bluntly outspoken style is somewhat akin to that of a gangster boss, President Xi is more of a man whose words and actions do not always align. Beijing rarely makes public its military aid to Iran. Instead, it often operates under the guise of exporting civilian goods or conducts operations covertly.

President Xi is understandably concerned that Iran might suffer a fate similar to Venezuela’s – one of submission to U.S. will. He does not want Iran to lose the war, as that would mean China might not be able to reobtain cheap oil from the country. Yet he does not want to antagonize the U.S. – or even other Middle Eastern nations – over Iran, thereby jeopardizing his goals in economic and technological sectors. His aim is to strike the right balance between these two opposing objectives.

China is also an arms supplier to Iran and Arab countries in the Middle East. During the war, Iran shot down a “Wing Loong II” drone – a Chinese-made model – which is believed to have been launched by Saudi Arabia.

This explains why Beijing defends Iran’s control of the Strait of Hormuz, while at the same time inviting the Crown Prince of Abu Dhabi Khaled bin Mohamed Al Nahyan to visit China in April.

Chinese satellites monitoring the Middle East

During the war, the U.S.-Israel coalition carried out large-scale digital deception and signal jamming of Beidou, China’s satellite navigation system. This interference caused frequent signal drift in Iranian missiles that relied on high-precision guidance components sourced from China. These quality issues, also found in other military systems and facilities, stem in part from corruption within China’s defense industry and the practice of inflating numbers to meet quotas.

Upon learning of the substandard quality of some of the military weapons and equipment supplied to Iran during the war, Chinese leaders took severe measures. It is generally estimated that the recent revocation of the academic titles of five Chinese experts was related to corruption leading to the poor quality of some weapons supplied to Iran prior to this war. The fields they oversaw included radar, nuclear weapons, missile guidance, J-20 fighter jet design and high-frequency microwaves.

Of course, it should also be noted that some of the military technology and weapons provided by China to Iran posed a real threat to U.S. forces. For example, Beijing recently conducted an in-orbit upgrade of the Beidou satellite navigation system, further enhancing the accuracy and stability of its signals and positioning capabilities. China continues to provide this technology to Iran under the guise of civilian use. It is believed that this has a direct connection to Iran’s high hit rate in the war.

According to various sources, at least three Chinese engineers involved in military aid were killed by U.S. and Israeli airstrikes at the start of the war. They were senior radar technicians from an elite unit in Nanjing – the 14th Research Institute of the China Electronics Technology Group Corporation. It is believed that Chinese authorities failed to anticipate the outbreak of war in time and evacuate them promptly.

China’s military support for Iran during the war

Although Beijing’s arms sales and military aid to Tehran during the war have been, overall, far less extensive than before the war, such activities have continued. According to ship-tracking data, satellite imagery and U.S. Treasury records, a fleet of Chinese cargo ships is suspected of having transported sodium perchlorate – a precursor to solid-fuel missile propellant – to Iran in March of this year. The propellant from these five ships could be used to launch nearly 800 missiles. Even on April 20, an Iranian cargo ship, fully loaded with dual-use materials for weapon production which departed from China, was seized by the American Navy near the Strait of Hormuz.

In 2025, China had already supplied Iran with 1,000 tons of sodium perchlorate. Notably, sodium perchlorate itself is not explicitly listed by the United Nations or the Missile Technology Control Regime as a substance prohibited from export to Iran. China therefore argues that such trade constitutes normal commercial transactions. However, the U.S. has already imposed sanctions on several Chinese companies suspected of shipping sodium perchlorate to Iran.

The U.S. Defense Intelligence Agency has assessed that an artificial intelligence tool used by the Chinese company MizarVision poses a threat to the U.S. military. MizarVision’s website states that the company’s mission is to lower the “barrier to entry for geospatial intelligence discovery and analysis … so that it is no longer the exclusive capability of a select few organizations.” During the Iran conflict, MizarVision has consistently used AI software to identify various military capabilities – including specific aircraft types, the locations of naval vessels, air defense systems and radar deployments – and has published this data on open-source platforms.

In the medium and long term, China will be a loser in this war.

 

In the week leading up to the outbreak of the Iran conflict, the company’s social media account posted images of the Prince Sultan Air Base in Saudi Arabia at least six times, revealing the locations of Patriot air defense systems and dozens of aircraft, accompanied by analysis. Less than 48 hours after the last image was posted, Iran launched a retaliatory strike on the base, resulting in damage to American materiel and the death of a U.S. soldier who succumbed to his injuries.

Meanwhile, the U.S. suspects that Iran used Chinese-supplied man-portable air defense systems (MANPADS) to shoot down American aircraft. To prevent China from secretly continuing to supply such weapons during the war, President Trump specifically issued a warning to Beijing after the collapse of negotiations between the U.S. and Iran.

Furthermore, China’s largest chip manufacturer, SMIC, has supplied production equipment to the Iranian military, beginning roughly about a year ago. Even during the war, these shipments did not cease, as China considers these products to be for civilian use.

What is at stake for Beijing?

It is hard to imagine whether China will be able to maintain relations with Iran that are as strong as – or even stronger than – before the war, when it could import 1.3 million barrels of oil daily at discounted prices.

In the short term, China’s resilience to an energy crisis is indeed greater than that of any other energy-importing nation. This is because for nearly three decades it has cultivated a strong sense of urgency regarding energy security. Consequently, its oil and natural gas reserves far exceed those of any other energy-importing country.

Coupled with the diversification of its energy supply sources, which is unmatched by other nations, it is well equipped to withstand an energy crisis for some time. Yet if Iran is lost after Venezuela, China’s supply of cheap oil will further diminish, inevitably hurting domestic transportation and petrochemical production. This is precisely why Beijing is now rushing to restart discussions on the Power of Siberia 2 pipeline. It also explains why, following the outbreak of the Iran war, China hastily signed a new energy cooperation agreement with Turkmenistan for pipeline development.

In the medium and long term, China will be a loser in this war. Once it loses access to large quantities of cheap oil, Beijing’s economy will become weaker, and its long-cherished dream of a “petro-yuan” (to counter the petrodollar) will become much harder to achieve on a large scale.

This report was originally published here: https://www.gisreportsonline.com/r/china-iran-war/