War between Israel and Iran: Why China is exercising restraint

Seoul. While the Chinese embassy in Tehran is already transporting its citizens to safety by long-distance bus to the border with Turkmenistan, over a thousand kilometers away, Xi Jinping speaks out for the first time on Tuesday: "All parties should work for the fastest possible de-escalation of the conflict and prevent further escalation," the 72-year-old said on Tuesday. It is striking that he does not directly criticize Israel, but instead chooses vague wording. Finally, the Chinese party leader boldly announces: "China is ready to play a constructive role in restoring peace and stability in the Middle East." But this is likely to be more than just lip service.

On the surface, Chinese interests in the Middle East appear clearly divided: Beijing covers large quantities of its energy needs with Iranian oil, while Israel, as a close US ally, represents an ideological enemy. While this analysis is not fundamentally wrong, it falls far short: China's actual role in the war between Israel and Iran is considerably more ambivalent.

The fact is: Iran exports approximately 270 million liters of crude oil (1.7 million barrels) every day, and over 90 percent of that goes to China. This is clearly an asymmetric, almost colonial trade relationship: Due to existing US sanctions, there are only a few countries that still want to import Iranian oil. And China is radically exploiting its monopoly position: It purchases at a significant discount – and also processes its imports in renminbi. The Chinese currency is subject to strict capital controls, which de facto means that Iran is ultimately forced to invest its profits in Chinese products. For the People's Republic, this is a double win.

In its external propaganda, however, the Chinese leadership presents itself as altruistic. Beijing's diplomacy is primarily aimed at promoting development and peace while simultaneously exploiting economic opportunities, argues Hongda Fan of Shanghai International Studies University: "A peaceful and stable Middle East is of greater benefit to China," comments the country's leading Middle East expert in a recent debate contribution.

While Fan condemns Israel's attacks on Iran, he primarily criticizes the Western states that support Israel: "The shameless and immoral attitude of the European and American powers toward the war between Israel and Iran shows why they are degenerating. They are no longer a model of democracy for the world," the expert writes on X, formerly Twitter.

China's message is intended to resonate primarily in the Global South: While the USA approves of wars that violate international law and acts in a morally didactic and imperialistic manner, pragmatic China is concerned with economic development and a just world order.

But such rhetoric also poses a certain risk for Beijing. While the party leadership can mislead its own population with its state-controlled media and comprehensive censorship apparatus, the obvious hypocrisy should not be lost outside its own borders: China condemns Israel's war, yet at the same time, even after more than three years, hasn't uttered a single syllable of criticizing Russia's war of aggression against Ukraine. Quite the opposite: China's economy is keeping Vladimir Putin's war machine afloat in the first place by supplying so-called "dual-use" goods.

In the Iran-Israel conflict, the Chinese could also be accused of sustainably supporting the Islamic regime with their massive oil purchases. Quite a few critics claim that the regime in Tehran would have already collapsed without trade with China.

However, one should not overlook the fact that Beijing is indeed pursuing strategic interests on both sides of the conflict. China has recently intensified its business relations with Turkey and, in particular, the Gulf states. Accordingly, the country's leadership does not want to position itself entirely on one side, nor does it even want a war in the region. Quite the opposite: Beijing's primary goal for the Middle East is stability. If the shipping routes along which oil flows to the Middle Kingdom are blocked by war, not only China's energy security but also its economic growth would be massively threatened.