Journalists and analysts are making the same mistakes about Iran that they made a few weeks ago about Venezuela.
There are the simple errors, like referring to Iran as Beijing’s “longtime ally.” Iran is a client state, not an ally. Tehran depends on exporting most of its oil to Red China to stay financially solvent. It enjoys no security guarantees.
Then there are the complicated errors which look simple. Red China, reporters report, will experience an oil shock with the loss of Iranian crude. Better to say that Asia will experience that oil shock, since Beijing is the third-largest oil exporter to Asia and plenty of Russian oil is available to Beijing at a discount when needed. Besides, Red China’s oil storage sites are full. So more Russian crude will not be needed for some time.
Wait…what?
What’s that you say? How can oil-free Beijing be the third-largest oil exporter to Asia?
The game played with Iran is the same as the game played with Venezuela. Buy sanctioned oil at a deep discount, move cheap crude to mainland refineries, then sell the refined products at full market rates for some tidy profits.
Oh, and also to add insult to injury by falsifying point-of-origin papers to pretend that the oil coming from Iran (which, per sanctions, is not supposed to be coming from Iran) is really coming from (competing) Malaysian or Indonesian refineries.
Because the CCP has reduced the oil-export quotas allowed its biggest refineries, it is Communist China’s many oil customers who will actually feel the oil shock.
This is a precautionary move. The supply chain shifts. The easy Iranian profits are over, but the profits from imports of Russian oil continue. Circumstances will now “force Beijing to alter its oil smuggling or import strategies used to circumvent previous US sanctions on Iran, thus increasing energy costs.” Increasing the costs for the buyer of Beijing’s oil, not necessarily the costs for mainland Chinese.
The “ally” fallacy
Aside from buying over 80 percent of their oil, the communists have provided Iran with modern military equipment, diplomatic support, international integration through BRICS and the Shanghai Cooperation Organisation, access to markets, and broad economic support, lately with a 25-year commitment to invest $400 billion.
Iran is a client state; and the more of a pounding it takes from the United States, the more dependent it becomes on Beijing.
For Beijing, what more could security guarantees have extracted from this relationship? Security guarantees would only have risked drawing the communists into a conflict far from the main theater and the main prize…unification with Taiwan.
“For China to provide military and security support to Iran—that, I believe, violates the principles of China’s foreign policy,” says Professor Cui Shoujun, executive director of the Centre for Middle East and African Studies at Renmin University in Beijing.
Moreover, Gabriel Wildau, a China specialist at advisory firm Teneo, says that preserving détente with the United States “remains a strategic priority for China’s leadership.” This may be the case since, so far, the meeting between U.S. President Donald Trump and Xi Jinping later this month is still on—even after the United States has attacked two of Red China’s so-called “allies.”
The sensible CCP calculation has been that the more active the Iranian threat, the more the United States is drawn into crises far from the Taiwan Strait.
How Beijing loses
So there is this tension. Beijing wins if Iran comes out of this with sufficient strength to remain a threat to U.S. interests, it loses if Iran becomes useless as a threat and more of an economic drain.
Hudson Institute fellow Zineb Riboua lays this out starkly. “By striking Iran directly, the Trump administration is dismantling, whether by design or by consequence, a pillar of China’s regional architecture.”
The logic here requires no conspiracy theory to explain. Every dollar the United States spends defending Red Sea shipping lanes is a dollar unavailable for submarine production, Pacific basing, or Taiwan contingency planning. Every carrier group stationed in the Gulf of Aden is a carrier group absent from the Western Pacific. Iran’s proxies, armed with Iranian weapons and supported by Iranian intelligence, function as a mechanism of American strategic attrition, and the costs fall entirely on Washington while Beijing accumulates strategic gains….
Every year Washington spends managing Tehran is another year Beijing buys in the Pacific, and the administration has decided the trade isn’t worth it anymore.
So she views the Middle East as a burdensome second front for the U.S.
The strikes should not be understood as an end in themselves. They are the opening act in the larger contest against China, because Iran is where Beijing’s Middle East architecture is most concentrated and most vulnerable. Collapse the Islamic Republic and you remove the single greatest drain on American strategic bandwidth, expose the fragility of every client relationship Beijing has built from Tehran outward, and free the United States to concentrate on the Pacific with a credibility that twenty years of pivot talk never produced.
Commentator Gordon Chang says, “I believe that President Trump is going after the [Communist] Chinese, and he’s not doing it directly.”
First Venezuela. Then Panama. Now Iran. Gordon Chang is right. Journalists are missing the story. Iran is about China. □
