China is a clear winner from Trump’s war in Middle East, report concludes
China has emerged as the sole winner in Asia from the strait of Hormuz crisis, according to a report published on Tuesday.
The report by the Asia Group thinktank concluded that China had weathered the storm of the global commodities crisis resulting from the closure of the Middle Eastern waterway, and also stood to gain from the economic and geopolitical trends sparked by the wider conflict.
Iran virtually closed the strait, a vital waterway through which much of the world’s oil and gas flows, after the US and Israel launched joint strikes on 28 February, targeting government and military sites and killing Iran’s supreme leader, Ali Khamenei. The ensuing crisis has sent global energy prices soaring, with Asia particularly exposed.
The report noted that before the strait’s closure, roughly 80% of the oil and nearly 90% of the liquefied natural gas transiting the waterway was destined for Asian markets, along with a significant share of other critical commodities.
The report looked at Asia’s largest economies – China, India, Japan and South Korea – as well as emerging markets across south-east Asia. The researchers mapped the economic and political repercussions of the crisis and its impacts across key sectors including manufacturing, energy and agriculture.
They concluded that China was a clear winner from the crisis caused by Donald Trump’s foray into the Middle East.
The country’s large stockpiles of oil and the hugely ambitious rollout of renewable energy mean it has been less exposed to the energy shock than other countries.
China has long maintained strategic reserves of energy, and last year took advantage of cheap prices to build up even bigger stockpiles. Its crude imports grew from 11.1m barrels a day to 11.6m in 2025, with over 80% of that increase being sent to stockpiles, according to analysis by Erica Downs, a senior research scholar at the Centre on Global Energy Policy. As of January, China had enough stockpiled to cover 104 days of imports at the 2025 level.
The country has also been building massive amounts of renewable energy infrastructure in recent years. Last year it installed 315GW of new solar capacity, more than half of the world’s new solar. The year before, it added 277GW. Beijing is aiming for half of China’s energy to come from non-fossil sources by 2030, with the share from wind and solar reaching 30%, up from 22% in 2025.
Although China’s energy mix is still largely based on coal, which accounts for more than 50%, renewables’ share is increasing rapidly.
The Asia Group’s report said: “With 1.4 terawatts of operating renewable capacity already online and a reported 90-110 days of crude import cover in reserve, China weathered the initial shock better than any regional peer.”
China has also benefited from other countries reacting to the crisis by accelerating its clean energy buildout. Beijing dominates the global supply chain in solar and other clean technology industries and in recent years has been pushing much of this production overseas at low prices, to the chagrin of western leaders worried about their own industries.
China’s electric vehicle exports soared by more than 110% in May compared with the previous year, while solar shipments in April increased by 60%.
Beijing has called for a ceasefire in the Middle East, and when Trump visited in May and met China’s president, Xi Jinping, he claimed the two countries were united in wanting to find a settlement. But the Asia Group report noted: “The crisis allows Beijing to cast the United States as the destabilising actor whose Middle East entanglements impose costs on the world.”
There are some risks to China from the instability. Drew Thompson, a senior fellow at the S Rajaratnam School of International Studies in Singapore, said: “It’s tempting to see any loss of credibility in the US as a benefit for China, but that’s not necessarily the case for Beijing, which does not want to supplant Washington as a Middle East hegemon or provider of security for the region.”
Wen-Ti Sung, a non-resident fellow with the Atlantic Council’s Global China Hub, based in Taiwan, said the crisis could also make Beijing think twice about a future military assault on Taiwan because it showed the difficulty of navigating ships through hostile territory.
The Asia Group’s report concluded: “Ultimately Beijing views the pain points not as existential threats, but as challenges to be managed and even opportunities to be exploited.”
Read the full story at The Guardian ↗
Following the closure of the Strait of Hormuz after US-Israel military operations against Iran in late February, an Asia Group report assessed how major Asian economies weathered the resulting energy crisis. The analysis examined China, India, Japan, South Korea and southeast Asian markets, which collectively depend on roughly 80% of the strait's oil and 90% of its liquefied natural gas. China experienced less economic disruption than regional peers, owing to strategic reserves built up over recent years—sufficient to cover 104 days of imports at 2025 consumption levels—and a substantial renewable energy infrastructure rollout. In 2024, China installed 315GW of new solar capacity, representing more than half of global additions. As disruption accelerated global demand for clean energy alternatives, China's exports of electric vehicles and solar equipment grew substantially. The report noted that while the crisis poses manageable challenges for Beijing, it also offers opportunities within its strategic interests, and allows China to frame US Middle East involvement as destabilising to global stability.
Read the full story at The Guardian ↗
China has emerged as the sole winner in Asia from the strait of Hormuz crisis, according to a report published on Tuesday.
The report by the Asia Group thinktank concluded that China had weathered the storm of the global commodities crisis resulting from the closure of the Middle Eastern waterway, and also stood to gain from the economic and geopolitical trends sparked by the wider conflict.
Iran virtually closed the strait, a vital waterway through which much of the world’s oil and gas flows, after the US and Israel launched joint strikes on 28 February, targeting government and military sites and killing Iran’s supreme leader, Ali Khamenei. The ensuing crisis has sent global energy prices soaring, with Asia particularly exposed.
The report noted that before the strait’s closure, roughly 80% of the oil and nearly 90% of the liquefied natural gas transiting the waterway was destined for Asian markets, along with a significant share of other critical commodities.
The report looked at Asia’s largest economies – China, India, Japan and South Korea – as well as emerging markets across south-east Asia. The researchers mapped the economic and political repercussions of the crisis and its impacts across key sectors including manufacturing, energy and agriculture.
They concluded that China was a clear winner from the crisis caused by Donald Trump’s foray into the Middle East.
The country’s large stockpiles of oil and the hugely ambitious rollout of renewable energy mean it has been less exposed to the energy shock than other countries.
China has long maintained strategic reserves of energy, and last year took advantage of cheap prices to build up even bigger stockpiles. Its crude imports grew from 11.1m barrels a day to 11.6m in 2025, with over 80% of that increase being sent to stockpiles, according to analysis by Erica Downs, a senior research scholar at the Centre on Global Energy Policy. As of January, China had enough stockpiled to cover 104 days of imports at the 2025 level.
The country has also been building massive amounts of renewable energy infrastructure in recent years. Last year it installed 315GW of new solar capacity, more than half of the world’s new solar. The year before, it added 277GW. Beijing is aiming for half of China’s energy to come from non-fossil sources by 2030, with the share from wind and solar reaching 30%, up from 22% in 2025.
Although China’s energy mix is still largely based on coal, which accounts for more than 50%, renewables’ share is increasing rapidly.
The Asia Group’s report said: “With 1.4 terawatts of operating renewable capacity already online and a reported 90-110 days of crude import cover in reserve, China weathered the initial shock better than any regional peer.”
China has also benefited from other countries reacting to the crisis by accelerating its clean energy buildout. Beijing dominates the global supply chain in solar and other clean technology industries and in recent years has been pushing much of this production overseas at low prices, to the chagrin of western leaders worried about their own industries.
China’s electric vehicle exports soared by more than 110% in May compared with the previous year, while solar shipments in April increased by 60%.
Beijing has called for a ceasefire in the Middle East, and when Trump visited in May and met China’s president, Xi Jinping, he claimed the two countries were united in wanting to find a settlement. But the Asia Group report noted: “The crisis allows Beijing to cast the United States as the destabilising actor whose Middle East entanglements impose costs on the world.”
There are some risks to China from the instability. Drew Thompson, a senior fellow at the S Rajaratnam School of International Studies in Singapore, said: “It’s tempting to see any loss of credibility in the US as a benefit for China, but that’s not necessarily the case for Beijing, which does not want to supplant Washington as a Middle East hegemon or provider of security for the region.”
Wen-Ti Sung, a non-resident fellow with the Atlantic Council’s Global China Hub, based in Taiwan, said the crisis could also make Beijing think twice about a future military assault on Taiwan because it showed the difficulty of navigating ships through hostile territory.
The Asia Group’s report concluded: “Ultimately Beijing views the pain points not as existential threats, but as challenges to be managed and even opportunities to be exploited.”
Read the full story at The Guardian ↗
The US and Israel launched joint strikes on 28 February, targeting government and military sites and killing Iran's supreme leader, Ali Khamenei. Iran virtually closed the Strait of Hormuz following these strikes. Roughly 80% of oil and nearly 90% of liquefied natural gas transiting the waterway was destined for Asian markets. The Asia Group report concluded that China was a clear winner from the crisis caused by Trump's foray into the Middle East. China had crude import stockpiles equivalent to 104 days of imports as of January. China installed 315GW of new solar capacity in 2024, more than half of the world's new solar. China's electric vehicle exports soared by more than 110% in May compared with the previous year. The crisis allows Beijing to cast the United States as the destabilising actor whose Middle East entanglements impose costs on the world. China's energy mix is still largely based on coal, which accounts for more than 50%, though renewables' share is increasing. It's tempting to see any loss of credibility in the US as a benefit for China, but that's not necessarily the case for Beijing, which does not want to supplant Washington as a Middle East hegemon.
Read the full story at The Guardian ↗
- The Asia Group thinktank concluded China emerged as the sole regional winner from the Strait of Hormuz crisis triggered by US-Israel strikes on Iran in late February
- China's large strategic oil reserves (104 days of import cover) and rapid renewable energy expansion (315GW of solar installed in 2024) insulated it from energy price shocks that affected other Asian economies
- China's dominance in clean technology manufacturing and EV exports expanded as global demand for alternatives accelerated, while Beijing positioned the US as a destabilising actor