The conventional wisdom was that a destabilizing war in the oil-producing heart of the Middle East would badly hurt China, the world's leading oil importer, and its sputtering economy. It hasn’t worked out that way. So far, China is weathering the US-Israeli war with Iran better than many of its neighbors and looks set to emerge relatively stronger.
Unlike Vladimir Putin and Donald Trump, who have launched wars against overmatched opponents only to face unwelcome surprises, President Xi Jinping has avoided unnecessary risks to position his country for long-term strength and stability.
We saw Xi’s caution in his responses to both the COVID-19 pandemic and China’s structural economic weaknesses of recent years. We also saw it in Xi’s unwillingness to directly support Russia’s war in Ukraine, or even to recognize Putin’s territorial claims.
Now we see it in Xi’s reluctance to criticize Trump’s bombing campaign against his allies in Tehran, or to come to Iran’s direct aid. The invitation for the US president to visit Beijing next month stands.
It helps that China is less damaged by this war than it would have been even a few years ago. Its oil stockpiles and strong refining capacity limit the risk of near-term fuel shortages.
Pipeline gas imports and domestic gas production now ease its need for liquified natural gas from the Middle East. If the war drags on, Beijing can get more energy from friendly countries, particularly Russia, and can turn to both its vast coal reserves and its renewable power sources.
The war has even provided some advantages. China’s fully-integrated supply chains make it better able than rival exporters to contain production costs. And the continuing disruptions to energy shipments through the Strait of Hormuz, which have sharply increased both oil prices and the cost of insurance for shipping, will boost demand for China’s clean tech exports, lifting long-term investment in electrification while diversifying away from oil and gas.
These processes were well underway before this war – they’re central to what Eurasia Group identified as 2026’s second-biggest geopolitical risk, the growing divergence between China’s electrostate and America’s petrostate models – but the conflict’s destruction of fossil-fuel infrastructure and fears of more to come will now accelerate them.
Strategically, China also benefits from a war that has weakened American firepower. The conflict has depleted US stockpiles of long-range cruise missiles and interceptors that will take years to rebuild.
Those shortages are already rippling outward: THAAD components have been pulled from South Korea, Patriot batteries are unavailable for Ukraine and US allies in Asia, and the redeployment of US naval and air assets to the Middle East has thinned coverage in the Indo-Pacific.
The cumulative effect is to erode American deterrence in the theaters where Beijing has the most at stake, while allies from Seoul to Tokyo quietly reassess how durable Washington’s security commitments really are.
All of this deepens Washington’s already-acute dependence on Beijing’s exports of the critical minerals needed for the production of new weaponry and ammunition. The US could plausibly find workarounds to China’s restrictions in the next three to five years, but a decade is a more realistic timeframe.
In the meantime, Trump will have a weaker negotiating hand with his Chinese counterpart, with whom he plans to meet in Beijing next month.
China also benefits from ongoing damage to America’s reputation as a reliable international actor as both wealthy and developing countries look to hedge their bets on Washington’s foreign policy future.