Oil Market

Analysis: Tehran Has Not Impressed China – That's Why They're Not Getting Help

China may be greatly affected by the fact that its oil imports from the Middle East are being cut off as a result of the war, but it is unlikely that the country will send any help whatsoever to its allies in Tehran. Yun Sun writes in an analysis in Foreign Affairs.

Chinese strategists are simply not particularly impressed by Tehran, not least because of the repeated attempts to negotiate with Washington, she writes.

"Beijing has become increasingly disillusioned with Tehran's ability and credibility as a regional power player."

As long as the next government in Tehran ensures that the oil continues to flow, China is essentially unconcerned about who rules, Yun Sun continues.

Taiwan-based Australian political scientist Wen-ti Sung tells Time that the most important insight for China, however, is how effectively the United States managed to knock out Ayatollah Ali Khamenei.

– China’s first reaction will be: This could happen here.

Plan for the Strait of Hormuz questioned: “Enough?”

Donald Trump promised earlier this week to provide assistance with fleet cards for oil tankers and container ships through the Strait of Hormuz. In addition, the US Department of Defense will offer insurance against political risk for trade in the area.

But analysts at the major bank JP Morgan see a lot of problems with Trump’s plan, writes Marketwatch.

According to the bank, the DFC’s insurance ceiling is “too low in relation to the risk”. According to the analysts, the mandate that the authority has today would not cover ships that are damaged or destroyed while passing through the strait, which means that shipping companies still risk large losses.

Analysts at Wolfe Research believe that Trump’s measure is indeed feasible, but question whether it will have any actual effect.

“Will this be sufficient assurance for maritime trade that it is indeed possible to pass through the Strait of Hormuz? It is not entirely clear to us,” it writes, among other things. 

The oil market during the Iran war — this has happened

• US and Israeli attacks on Iran led to Iran’s Revolutionary Guard announcing the closure of the Strait of Hormuz, a crucial transport route for global oil trade.
• Oil prices rose sharply, reaching over $82 per barrel, the highest level since July 2024, following Iran's threats and actual disruptions in the strait.
• Hundreds of oil tankers were stopped outside the Strait of Hormuz and major shipping companies halted traffic, creating concerns about global supplies
• 
  The US has announced military escort and insurance guarantees for ships in the strait. According to the EU and US military, the strait has not been completely closed.
• Experts warn that a prolonged shutdown could push oil prices above $100 per barrel and affect gasoline and electricity prices globally.