The long-awaited summit meeting between Chinese President Xi Jinping and US President Donald Trump on 14-15 May in Beijing has become engulfed by the fallout of the US war on Iran and the Iranian retaliation that has continued to affect the Gulf region.
Trade negotiations remain at the heart of the summit meeting, which comes after a hiatus in tensions between the two countries that eased during a meeting between the two presidents in South Korea in October. But relations between them are now becoming increasingly impacted by the geopolitical tensions resulting from the US war on Iran.
The agenda on the negotiating table at the summit remains rooted in trade and investment. The US is seeking expanded Chinese investment, while Beijing aims to stave off tariff increases and secure an easing of the constraints imposed by the US on its semiconductor trade and manufacturing capacity.
Xi is also expected to press Trump to reduce US support for Taiwan’s self-governing status, while Trump will urge Beijing to pressure Iran to keep the Strait of Hormuz open.
Washington recently imposed sanctions on three commercial satellite companies accused of providing imagery that facilitated strikes against US forces in the Middle East, in a move reported by the UK Financial Times.
Earlier, China retaliated against US sanctions imposed on a Chinese refinery for purchasing Iranian oil by effectively ignoring the measures while reportedly ordering its agencies to investigate foreign entities, including companies and governments, involved in enforcing restrictions on Chinese interests.
China comes to the table with the view that the United States has been distracted from any potential escalation in East Asia, particularly over Taiwan, due to its war against Iran. On the issue of Taiwan’s status vis-à-vis the Chinese mainland, Beijing is therefore unlikely to concede ground or accept pressure for any form of autonomous recognition of the island.
At the same time, Trump may place a form of strategic trade-off on the table that will propose reduced pressure on China over Taiwan in exchange for Beijing lobbying Iran to refrain from closing the Strait of Hormuz.
US Treasury Secretary Scott Bessent last week publicly urged China to put pressure on Iran regarding the Strait of Hormuz and broader regional escalation.
For its part, Iran has sought to draw China closer diplomatically, as witnessed by the 6 May visit to Beijing by Iranian Foreign Minister Abbas Araghchi. With Iran remaining one of China’s key strategic and energy partners in the Gulf, Beijing has continued to purchase Iranian oil.
Like much of the rest of the world, China faces vulnerabilities arising from the conflict, particularly in terms of energy supply chains, maritime trade routes, and already sluggish economic growth. Yet, Beijing has also developed a political stance in which it presents itself as a “neutral” party amid hostilities whose fallout is also affecting key Gulf partners, namely Saudi Arabia and the UAE.
China’s policy vis-à-vis the conflict has been to adopt a militarily non-interventionist approach, which it presents as a defining feature of its foreign policy in implicit contrast to what it portrays as Washington’s heavy-handedness in the region. Beijing has refused to join US-led military initiatives aimed at securing or reopening the Strait of Hormuz.
China’s Gulf partners – states in which Beijing has heavily invested through trade, infrastructure, and Belt and Road Initiative projects – are also watching closely. Chinese investments in Gulf ports, industrial zones, logistics corridors, telecommunications infrastructure, and energy projects have expanded significantly over the past decade, particularly in Saudi Arabia and the UAE.
Stability in the Gulf is therefore no longer merely an energy concern for Beijing but is increasingly tied to the protection of the long-term commercial and geopolitical investments that are central to its regional strategy.
On 14 April, President Xi presented a four-point plan for the Gulf region to Sheikh Khaled bin Mohamed bin Zayed Al Nahyan, crown prince of Abu Dhabi, combining security guarantees with political autonomy considerations through a framework of peaceful coexistence, national sovereignty, the rule of international law, and the coordination of development and security.
This positioning by China comes at a particularly sensitive moment for the region, in which alliances could begin recalibrating amid divergent positions among the Gulf states over the war and its implications. The Gulf governments, while maintaining security ties with Washington, have simultaneously deepened their economic cooperation with Beijing, giving China growing leverage but also exposing it to greater regional risk.
While the fallout from the war threatens China economically through disruptions in supply chains and energy flows, Beijing may simultaneously gain strategically and politically by continuing to position itself as a neutral arbiter adhering, at least militarily, to a doctrine of non-intervention. Such positioning also allows China to contrast its approach with the long-standing military footprint of the US in the Middle East.
Another unspoken advantage for Beijing may lie in the growing realisation among the Gulf states of the importance of diversifying their strategic alignments despite their alliances with Washington. China’s expanding economic footprint through the Belt and Road Initiative has also provided it with diplomatic inroads across the region.
Energy security, maritime routes, and geopolitical leverage thus now sit firmly on the negotiating table. China’s diplomatic channels with Iran potentially offer Washington something it wants: pressure on Tehran to avoid escalation in Hormuz. Araghchi’s visit to Beijing days before the summit only reinforced that perception.
Beijing, however, appears intent on maintaining roughly equal distance from both sides. Chinese policymakers recognise that should the Iranian regime collapse, this would remove a significant counterweight to US influence in the region. Yet China also remains heavily dependent on Gulf energy imports and is unwilling to alienate key partners such as Saudi Arabia and the UAE.
Beijing has repeatedly opposed interventionist positions against Iran in international forums, including vetoing, along with Russia, a UN Security Council resolution proposing the deployment of military force to reopen the Strait of Hormuz.
It did so while giving voice to the premise that such a deployment would further destabilise the Gulf region. Seen through the prism of Beijing’s deepening economic relations across the Gulf, such a stance may be assessed as an attempt to balance strategic ambiguity with economic pragmatism.
With the Trump-Xi summit fast approaching, Beijing is seeking simultaneously to stabilise its trade ties with Washington and prevent further regional fallout that could jeopardise its long-term interests.
The diplomatic exchanges surrounding the summit bring into focus the calculations of both parties, and it remains to be seen who will stay the course and whether US pressure on China to influence Tehran over Hormuz will outweigh Beijing’s calibrated “wait-and-see” approach.
China appears determined to avoid both extremes, neither fully aligning itself with Iran nor abandoning it altogether. In doing so, it seeks to preserve its image as a restrained global power, while at the same time protecting its expanding strategic and economic interests across the region.
* A version of this article appears in print in the 14 May, 2026 edition of Al-Ahram Weekly.
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