Chinese officials are reportedly concerned that Houthi attacks on ships in the Red Sea could harm their business relations with Iran, and have conveyed this message to Iranian counterparts in a series of meetings in Beijing and Tehran, according to sources familiar with the discussions. The trade route between Asia and Europe, utilized by Chinese ships, has been disrupted by these attacks, leading to increased shipping costs and insurance expenses.
The Chinese officials emphasized the need for the Houthis to exercise restraint in their attacks, warning that any harm to Chinese interests could impact Beijing’s business with Tehran. Despite China being Iran’s largest trading partner, the trade relationship is not balanced, with Chinese oil refiners heavily relying on Iranian crude exports, while Iranian oil only accounts for a small percentage of China’s crude imports.
China refrained from making specific threats regarding its trading relationship with Iran, but expressed deep disappointment in case any vessels linked to China were hit or if the country’s interests were affected. However, Tehran’s regional alliances and priorities, including support for proxies in Gaza, Lebanon, Syria, and Iraq, play a significant role in its decision-making process.
While China views the restoration of stability in the Red Sea as a priority due to its disproportionate impact on shipping, it is hesitant to use its leverage over Iran. This reluctance stems from multiple reasons, including its reluctance to publicly blame the Houthis for the Red Sea crisis and its awareness that Iran’s control over its Yemeni allies is limited.
China’s diplomatic efforts have not succeeded in stopping Houthi attacks on shipping, a concern raised by the United States and Britain. While China has the potential to influence Iran due to its oil purchases and potential direct investment in the country, it remains unclear whether Iran would take any action following discussions with Beijing. Despite the economic ties between China and Iran, Beijing’s influence on Tehran’s geopolitical decisions is not absolute, and Iran has other priorities and regional alliances to consider extensively.
Iran’s position as a leader of its “Axis of Resistance” complicates its decision-making process, as it needs to balance its support for allies like the Houthis with avoiding being drawn into a regional war over Gaza. Tehran’s messaging regarding the Houthis requires a level of deniability about the extent of its control over them, as well as an ability to claim some credit for their anti-Israel actions. Ultimately, while Iran depends on Chinese investment to maintain its oil sector, its regional alliances and geopolitical considerations also significantly shape its decisions.