BEIJING – China’s relations with countries such as Iran and Russia have raised expectations for a greater diplomatic role, but Beijing remains focused on protecting its domestic interests, including global exports.
The stance supports Beijing’s cautious acknowledgment of reports that Iran has pressed for a temporary ceasefire this week. A New York Times report cited three Iranian officials saying China played a role, and AFP quoted US President Donald Trump as saying.
Foreign Ministry spokesperson Mao Ning told reporters on Wednesday, in response to a question about the report, that China had made “active efforts” to end the conflict. He stressed that since the US and Israeli attack on Iran began on February 28, Foreign Minister Wang Yi has called representatives of countries including Russia, Saudi Arabia, Germany and Iran 26 times.
However, the Chinese government did not confirm the direction of the mediation.
China has called for an “immediate cessation” of military operations following the US and Israeli attack on Iran at the end of February. On March 3, when asked about Iran’s counterattack, China’s Foreign Ministry did not specifically mention Tehran, instead calling on “all parties” to prevent the conflict from escalating.
“What China has done is not really direct mediation,” said Zhongyuan Zoe Liu, senior fellow for China studies at the Council on Foreign Relations.
“What the Chinese government has done, more accurately, is brokered and facilitated a ceasefire,” he said on CNBC’s “China Connection” on Friday. “From that perspective, nothing has changed in terms of the Chinese government’s foreign policy.” That doesn’t mean the Chinese government is becoming more active. ”
Rather, he pointed out, the Chinese government is concerned about the risk that a global economic recession caused by the war will have a negative impact on its export-based economy.
Despite U.S. tariff increases, net exports accounted for about a third of China’s gross domestic product last year, leaving the country’s economy exposed to disruptions in global trade.
IMF Managing Director Kristalina Georgieva warned on Thursday that global economic growth would slow even if the ceasefire persists, citing lingering uncertainty around the Strait of Hormuz.
The strait is responsible for about one-fifth of the world’s oil supply and connects the Persian Gulf off the coast of Saudi Arabia with the rest of the world. China is a major buyer of Iranian oil, relying on waterways for just under half of its seaborne oil imports, but this accounts for only 6.6% of China’s total energy consumption.
Still, China is “under immense pressure from rapidly rising energy costs and hopes that the Strait of Hormuz will be reopened soon,” said Hai Zhao, director of international political research at the Chinese Academy of Social Sciences, a state-run think tank.
As of January, the Chinese government had enough crude oil reserves to meet three to four months’ worth of demand, according to estimates. According to data, Iran has been sending oil to China through the strait since the war began.
But gasoline prices in China rose 11% month-on-month in March, with authorities raising the country’s official gasoline prices twice in six weeks by a total of 1,580 yuan per ton, or about 60 cents per US gallon. During this time, the average price in the U.S. has increased by more than $1 per gallon.
Rising energy costs are also squeezing factory margins and increasing price pressure across China’s manufacturing industry.
Globally traded Brent crude oil futures fell below $100 a barrel on Friday, despite limited signs of a recovery in shipping through the Strait of Hormuz. Saudi Arabia’s state news agency said on Thursday that recent Iranian attacks on key Saudi pipelines have also reduced Saudi oil production.
background
China’s diplomatic position is based on its role in restoring diplomatic relations between Iran and Saudi Arabia three years ago, ending three decades of hostilities. This move raised China’s profile in the region and was noteworthy considering US interests in the region.
This history means that the Chinese government can act as a mediator if both sides are willing to reduce the conflict, Zhao said.
But he said China lacks the ability or inclination to pressure either side into negotiations. On the contrary, he said, Pakistan’s mediation efforts will become stronger with China’s support.
Pakistan, which shares borders with China and Iran, is scheduled to welcome Iranian and US leaders to Islamabad this weekend for ceasefire talks. The extent to which the Chinese government will be involved in the summit remains unclear.
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Chinese Foreign Ministry spokesman Mao Zedong said this week: “We support mediation efforts by countries including Pakistan.” He noted that the Chinese government calls on all parties to end hostilities as soon as possible in the interest of peace in the region. “China has made active efforts to this end.”
In late March, China and Pakistan announced a plan to “restore peace and stability” in the Middle East, including a ceasefire, peace talks, and the restoration of normal shipping to the Strait of Hormuz.
Pakistan this week abstained from voting on a UN Security Council resolution encouraging countries to coordinate their defense efforts to reopen the strait. China and Russia, members of the veto-wielding Security Council, opposed it and had planned to issue an alternative resolution.
Sultan Ahmed Al Jaber, CEO of Abu Dhabi National Oil Company, said in a social media post on Thursday that he had made it clear that ships must get permission from Iran to pass through the strait. “The Strait of Hormuz is not open. Access is restricted, conditioned and controlled.”
Before the war, amid heightened tensions with the United States, Iran occasionally harassed, attacked and seized ships passing through the strait.
“China welcomes any opportunity to project itself as a constructive and responsible power, as the Trump administration is seen as a source of instability,” CFR’s Liu said.
But she warned that the broader geopolitical dynamics had not changed.
“The fundamental structural tension between Beijing’s reliance on the rules-based world order and Washington’s growing willingness to disrupt that order remains not fully resolved,” she said.
“It’s a story worth pursuing beyond an immediate ceasefire.”
—CNBC’s Asriel Chua contributed to this report.
