As the United States and Israel escalate military action in the Middle East, China stands to benefit from Washington’s stretched resources, according to analysts. Beijing has condemned the strikes, with Foreign Minister Wang Yi calling them “unacceptable” and urging a ceasefire, but the real opportunity for China lies in leveraging its dominance over critical minerals used in defence.
The US military campaign against Iran, which is expanding into a regional conflict, diverts American attention and resources away from Asia. This creates space for China to exploit its control over rare earth elements and other strategic minerals, while the issue of Taiwan slips down Washington’s priority list.
However, the strikes pose risks to China’s oil supply. Beijing purchases about 80% of Iran’s shipped oil, accounting for roughly 13% of China’s seaborne imports, though much is disguised to avoid US sanctions. Losing this cheap supply would be a blow, especially after the US effectively took control of Venezuela’s oil industry in January. More than a fifth of China’s oil imports in 2025 came from sanctioned sources, including Iran, Venezuela, and Russia, and two of those supply chains are now imperilled.
Oil prices have already risen, with Brent crude hitting $82 per barrel on Monday, a 14-month high. Alicia García-Herrero, chief economist for Asia Pacific at Natixis, warned that this comes at a bad time for China, which faces surging energy demands from AI datacentres. “The trend is less and less oil at below market prices,” she said.
China has built strategic buffers, stockpiling oil last year. Crude imports rose 4.4% in 2025, with over 80% of the increase stored, according to Rystad Energy data. This should allow China to weather supply shocks for several months. Some analysts note that higher oil prices may hurt Trump more, as he seeks to contain inflation ahead of the US midterms.
Meanwhile, the US military campaign depletes American weapons stockpiles. The Pentagon halted weapons shipments to Ukraine last year due to dwindling supplies, and reports indicate the US has only 25% of the Patriot missile systems needed for its plans. This weakness, combined with China’s mineral dominance, gives Beijing a strategic edge as the conflict unfolds.
