The United States’ threat to impose a blockade on the Strait of Hormuz could pose a major challenge to China which purchases most Iranian crude oil exports today. The stoppage of Chinese carriers could lead to a direct confrontation between the US and China. Significantly, the issue may reach crisis point at a time the two countries are readying for a delayed Trump visit to China on May 14-15.In addition, the US threat to impose 50 % tariffs on any country supplying weapons to Tehran could become an issue. CNN claimed in a report that US intelligence believes China is preparing to supply new shoulder-fired air-defence missiles to Iran. The Chinese have flatly denied the charge.Illustration: Pariplab Chakraborty.On its part, China has made its redlines clear. According to a report in Beijing today, the Chinese defence minister admiral Dong Jun noted that China was monitoring the situation even as its ships were in the Strait of Hormuz area. He said China had trade and energy agreements with Iran, “we will respect and honour them and expect others to not meddle with our affairs.” As far as China was concerned, “Iran controls the Strait of Hormuz and it is open for us.”As of now, China’s credentials on both sides of the conflict stand. In an interview with AFP, Trump said he believed China had played a key role in bringing Iran to the negotiating table for the ceasefire deal. As for Iran, following the ceasefire, its ambassador in Beijing called on China along with Russia, Pakistan and Turkey to play the role of a guarantor of peace in the region.From China’s point of view, ties with the US have primacy. Beijing’s attitude to the war has been carefully nuanced to not cross Washington’s redlines. Chinese officials said foreign minister Wang Yi had had 26 phone conversations with counterparts to push its 5-point peace plan of March 31 calling for the reopening of Hormuz and a ceasefire.China, along with Russia, are two countries that have significant ties with Iran despite the US policy of isolating Tehran. Unlike India which has, under US pressure, systematically reduced its ties with Iran, China has maintained multifaceted but carefully calibrated ties. This is a reflection of its complex relationship with the countries of the region.So far, China has provided just enough indirect support to Iran to sustain the conflict, pursuing diplomatic visibility to enhance its global image, gathering invaluable military intelligence, and avoiding any direct confrontation with the US while the two powers navigate their broader rivalry.Beijing’s muted response reflects a careful balancing act: directly confronting the US would have risked damaging China-US relations at a time when Trump is reportedly eager for a trade deal with China and has even delayed a multibillion-dollar arms sale to Taiwan at Beijing’s request. But the situation could change.China has always historically avoided backing Iran militarily. Despite being a “comprehensive strategic partner” since a 25-year strategic agreement in 2021, Beijing supported UN-led economic sanctions against Iran before the 2015 nuclear deal and has been slow to fulfil investment commitments to Tehran.China relies on Hormuz for 40% of its total oil import. On March 31, it put forward a five-point proposal jointly with Pakistan calling for a ceasefire and the resumption of normal navigation in the Strait of Hormuz, and rallying support from Gulf countries.However, the Trump administration appeared to have little enthusiasm for Beijing’s mediation efforts, and some critics described China’s diplomacy as “performative” – messaging rather than genuine mediation.On April 7, China along with Russia vetoed a Bahrain-sponsored UN Security Council draft resolution regarding ship escorting in the Strait of Hormuz, stating it “failed to capture the root causes and the full picture of the conflict.”Despite being Iran’s strategic partner, China has stopped well short of direct military involvement. But multiple sanctioned Iranian ships believed to be carrying sodium perchlorate – a precursor material for solid-propellant rockets – did travel from China to Iran since the war began.In 2021, China also gave Iran full military access to its BeiDou satellite navigation system, though the extent to which Iran’s military is currently relying on it for drone and missile attacks remains unclear from open-source evidence.Additionally, according to The Washington Post, private Chinese technology companies – some with ties to the military – have provided detailed intelligence on movements of US forces in Iran, even as Beijing officially seeks to keep its distance.The Americans worry that Beijing is treating the war as a “live laboratory” – studying every US battlefield innovation, tactical decision and strategic move with intense focus. China is reportedly collecting multi-spectral imagery, electronic intelligence, and real-time data on US platforms including the F-35 and F-22.Economic balancingThe most important factor shaping China’s balancing act is money. The GCC states supply roughly 42% of China’s crude oil and 31% of its liquefied natural gas. In contrast, Iran accounts for only about 13% of China’s overall oil imports. By 2020, Beijing had poured $70 billion into GCC countries across energy, real estate, and infrastructure, compared to less than $5 billion total in Iran since 2007 – despite the much-hyped $400 billion Comprehensive Strategic Partnership agreement.China’s trade volume with the UAE and Saudi Arabia each stood at more than $100 billion in 2024, compared with less than $15 billion with Iran. Therefore, explicit support for Iran risks damaging Beijing’s far more economically significant relationships with the Gulf states.China has made a visible effort to reassure Gulf states during the conflict. On March 19, 2026, China’s special envoy for the Middle East Issue, Zhai Jun, concluded a regional tour meeting with the foreign ministers of Saudi Arabia, the UAE, Bahrain, Kuwait, and Egypt, as well as the secretaries general of the GCC and the Arab League, stressing that a ceasefire is the fundamental solution and urging an immediate end to hostilities.China’s Foreign Ministry also publicly stated that “the sovereignty, security, and territorial integrity of the Gulf states should likewise be fully respected” – a direct signal to GCC members who had come under Iranian attacks in retaliation for hosting U.S. military installations.China’s balancing was also visible in how it handled UN proceedings. China abstained from condemning Iranian attacks on Gulf states in UN Security Council Resolution 2817 – a carefully calibrated move that avoided both endorsing Tehran’s strikes on GCC territory and openly criticizing its strategic partner.This balancing act is not new – it reflects China’s broader policy in the Middle East which has for years been based on balancing among all major actors in the region without taking sides in their rivalries. Beijing maintains close relations with Iran and with its regional rivals, including Saudi Arabia and the UAE.Tehran has consistently sought deeper strategic alignment with Beijing, while China has prioritised balancing relations with other Middle Eastern partners and limiting security entanglements.China’s balancing act has held – but it could become harder to sustain. Beijing has successfully avoided choosing sides while extracting strategic value from the conflict: intelligence on US military capabilities, diplomatic visibility, and continued access to Iranian oil. But the variables are shifting. A US blockade of Hormuz, however temporary, would force Beijing into an uncomfortable public response. Washington’s threat to tariff arms suppliers could directly implicate Chinese companies. And if the Trump-Xi summit on May 14-15 proceeds, the war will inevitably be on the agenda – pushing China’s carefully cultivated ambiguity into the open.Ultimately, the arithmetic of Chinese interests is not subtle: its economic ties with the GCC dwarf those with Iran by almost every measure, and Beijing knows it. China would not like to be in a situation where it has to choose between them.The writer is a Distinguished Fellow, Observer Research Foundation, New Delhi.This piece was first published on The India Cable – a premium newsletter from The Wire – and has been updated and republished here. To subscribe to The India Cable, click here.