The failure of Islamabad peace talks and the new counter-blockades that the US has imposed in the Strait of Hormuz have widened the horizon of the West Asia war. While Iran was selectively allowing friendly vessels to pass, the US has put an umbrella blockade to all vessels. This is poised to hurt the China-Iran trade.
“The blockade will be enforced impartially against vessels of all nations entering or departing Iranian ports and coastal areas, including all Iranian ports on the Arabian Gulf and Gulf of Oman,” according to the US Central Command.
How Iran & China get affected by the US blockade move
In 2021, Beijing and Tehran had signed a comprehensive strategic partnership agreement covering economic, security, and technological cooperation over a 25-year period. However, all details of this partnership were not made public.
The Rasanah International Institute for Iranian Studies suggested that China will provide investments as well as economic and security services worth $400 billion over 25 years in return for a steady supply of oil from Iran, according to the partnership.
Iran being a highly sanctioned nation, official trade data with China is not available. However, China is by far the largest buyer of Iranian crude oil, purchasing upward of 90 per cent, often at a steep discount of $8-10 per barrel, according to the US-China Economic and Security Review Commission. In 2025, China imported almost 1.4 million bpd of Iranian oil, which accounted for about 12 per cent of its total crude imports, it added.
Why is it important for US to contain Iran-China trade ties
The US believes that China maintains substantial commercial ties with Iran despite multilateral sanctions on Tehran. The USCC said that China reported $9.96 billion in total bilateral trade with Iran in 2025, however, this does not include roughly $31.2 billion in unreported Iranian crude oil exports to China, which if included comprise over 75 per cent of total bilateral trade.
It added that oil revenue from China accounts for about 45 per cent of Iran’s government budget, money that in turn funds Iran’s destabilising activity throughout the region.
US accusation on China
US President Donald Trump has threatened China of a 50 per cent tariff if it militarily helps Iran. But, why does the US think so? The US government report highlighted that China enables Iran’s access to technology necessary for drone and weapons programs. It further said that China does so through networks of transshipment and shell companies in Hong Kong, China, and third-party countries.
Besides, the US also believes that the Chinese customs authorities do not officially report Iranian oil imports but rather falsely attribute origin to other countries, mostly Malaysia, Oman, and the UAE. The oil is transported on aging ‘shadow fleet’ tankers that hide their activity by using foreign flags, turning off transponders, geo-spoofing, and making ship-to-ship transfers.
