When I visited China in 2019, I had the opportunity to meet with officials from the foreign minister’s office, who assured me that no topic was off-limits. I had just watched the movie “Midway,” which depicted Japanese aggression against China during World War II — a conflict rooted in Japan’s ambition to dominate East Asia and control China’s raw materials.
Curious about how the relationship stood today, I asked. The officials responded that ties with Japan were “excellent” and stressed that trade between the two was mutually beneficial.
That exchange offered a glimpse into how Chinese diplomacy works: calm, pragmatic and intentionally non-confrontational. Beijing prioritizes stability and economic growth above ideological alignment or foreign entanglements. That approach also defines how China navigates its relationships with Iran and Russia, even while it maintains deep financial ties with the West.
In both cases, China benefits from discounted oil. This allows it to fuel its economy while sidestepping the diplomatic fallout of aligning with countries under heavy international sanctions.
Take Iran. China’s oil trade with Tehran is strategic and capitalizes on Iran’s global isolation. In June 2025, China imported a record 1.8 million barrels of Iranian oil daily, according to ship-tracking firm Vortexa. That accounted for 12 percent to 15 percent of China’s total daily oil imports, which stood at 12 million barrels. Nearly all of Iran’s oil exports now flow to China.
As the Institute for National Security Studies in Tel Aviv noted, “The sanctions leave Iran with no real alternative to China, and China is taking advantage of this situation to exert influence through trade and to purchase Iranian oil at substantial discounts.” In other words, Iran is a captive supplier, and China is making the most of it.
Still, China treads carefully. During the recent Iran-Israel war, Beijing issued a restrained response. China has formal ties with Israel that are centered on economic and technological cooperation, not politics or ideology. The two countries signed an $18 billion bilateral trade deal in 2023.
China’s relationship with Russia, by contrast, is broader and more public. In May 2025, presidents Xi Jinping and Vladimir Putin reaffirmed a “no limits” partnership, announcing 20 cooperation agreements across energy, finance and infrastructure. Both nations view their alignment as a counterbalance to Western influence. Here, too, economics plays a defining role.
Russia, also under Western sanctions due to its war in Ukraine, now supplies 19 percent of China’s oil imports at steep discounts. That saves China billions annually.
Consider: In 2023, China’s total trade with Russia was about $240 billion. However, its trade with the European Union reached $785 billion, and with the United States, $575 billion. Yes, China relies on the West far more than it needs Russia.
Specifically, analysts estimate that China saves $8 billion annually on discounted Russian oil and $7 billion from Iranian crude. That $15 billion windfall seems impressive until you consider what’s at stake.
Suppose China’s “support” for Iran or Russia triggers a Western backlash, even leading to a modest 1 percent decline in Western trade: that could cost China $13.6 billion annually. A 5 percent decrease would result in a $68 billion loss, significantly surpassing any possible oil savings.
The Jamestown Foundation, a Washington think tank, has reported extensively on how China’s trade helps Iran and Russia weather sanctions. It enables Iran to manufacture drones and allows Russia to keep funding its war in Ukraine. This dilutes Western influence.
So, why hasn’t the West imposed secondary sanctions on China? Because doing so would likely trigger retaliation and drive up global oil prices. In other words, punishing China could backfire economically.
That’s why the West continues to look the other way.
China has transformed from a developing nation into a global powerhouse, lifting millions out of poverty and deepening trade ties worldwide. It still needs affordable energy to sustain growth. That’s why it’s willing to buy cheap oil from Iran and Russia while staying close to the West.
For now, the math favors pragmatism. It’s a delicate and risky balancing act, and one that won’t last forever.