China’s 80% Grip on Iranian Oil Shapes the Lead-up to the September 24 U.S.–China Summit

Chinese state-linked buyers now take more than 80 % of Iran’s seaborne oil exports, according to commodities analytics firm Kpler. Iran accounts for roughly 1 % of China’s overall global trade, but the flow sustains Tehran’s war economy. To evade U.S. sanctions, the trade relies on a “shadow fleet” of older tankers and shell companies that keep transactions outside the Western-dominated financial system. The Trump administration has already blacklisted five independent Chinese refineries and dozens of China-linked shipping firms, yet the oil continues to move.

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The war in Ukraine-linked Iran conflict has cost the Pentagon more than $38 billion through August 1 (Congressional Budget Office). Simultaneously, the United States lacks a deployed aircraft carrier in the Western Pacific for the first time since World War II, a strategic gap Beijing can exploit. Shanghai crude futures hit a record 929.4 yuan ($137.80) per barrel this month after Iranian-backed drone attacks on Saudi infrastructure. China’s strategic oil stockpiling—an average of 1.1 million barrels per day injected into national storage last year, totalling 1.4 million barrels as of December 2025—gives it a reserve three times the size of America’s Strategic Petroleum Reserve, helping insulate its economy from price spikes.

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Chinese Foreign Minister Wang Yi told Iranian counterpart Abbas Araghch on September 16 that the two nations are “comprehensive strategic partners” and pledged to “strengthen dialogue and cooperation” while urging “all parties” to swiftly reopen the Strait of Hormuz. He stopped short of pressing Tehran to reopen the waterway. U.S. At a September 4 press briefing, President Donald Trump downplayed Beijing’s role, stating China is “not really involved” in the Iran war.

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• “China for sure wants the war to end -- a higher oil price is in no one’s interest, but the question is who should bear the cost to bring it to an end?” — Yun Sun, director of the Stimson Center’s China Program in Washington

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The White House has scheduled a high-stakes U.S.–China summit for September 24. Analysts expect quiet sanctions discussion rather than a breakthrough, as both sides weigh the economic fallout of targeting Chinese state banks that facilitate Iran’s oil trade.

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