A "Golden Year" Built on Sand
China and Iran Eye Closer Ties in 2025 — but the Foundation Is Far from Solid
When strategists weigh the shifting landscape of U.S. foreign policy, few partnerships raise more concern than that of China and Iran. Long treated as rival powers by Washington, the two have found common cause in resisting a unipolar, American-dominated world order. Now, amid the unraveling of once-stable U.S. commitments abroad, Beijing and Tehran are positioning 2025 as a golden year in their alliance, promising high-level visits and deepening cooperation across economic, military, and diplomatic fronts. With the Trump administration reviving a doctrine of strategic unpredictability — inconsistent priorities, sidelining traditional alliances, and intensifying economic warfare — the current environment has opened a rare window for China and Iran to expand their cooperation as both countries find themselves in the crosshairs of volatile U.S. foreign policy.
Four months into their so-called golden year, the messages of cooperation between the two countries are becoming difficult to ignore. China and Iran have conducted joint naval drills alongside Russia in the Gulf of Oman. Iranian oil exports to China have reached an all-time high, with increased use of the Chinese Yuan helping Iran avoid American sanctions on its oil exports. Likewise, they have tentatively offered diplomatic support regarding issues such as the renewed tension surrounding Iran’s nuclear program and U.S. sanctions.
Even so, this increased cooperation is not without risk. The deeper their alignment appears, the greater the potential for both nations to slide into a confrontational posture — even if neither seeks it outright. Yet for now, much of their coordination remains symbolic — a relationship built on sand, lacking the deep foundation needed to withstand long-term geopolitical pressure.
Economic Depth
Discussing the Gulf region without examining the role of oil and natural gas exports is nigh on impossible. Like its neighbors, Iran is considered a rentier state that relies heavily on selling its natural resources to generate revenue. However, unlike its neighbors, the Iranian economy faces a near-constant stream of sanctions hindering its ability to participate in the global market. This international climate incentivizes Iran to seek stable partnerships with the few nations willing to take on the political risk attached to Tehran’s invoices; so far, China has been a willing partner in this endeavor.
This cooperation has surged in 2025. China’s imports of Iranian oil rose to 1.8 million barrels per day in March, an all-time high, as concerns over U.S. President Donald Trump’s renewed campaign of “maximum pressure” on Tehran rose. This campaign aims to deny Iran “all paths to a nuclear weapon” and counter its “malign influence abroad,” which would ostensibly be achieved in part by ”driving Iran’s oil exports to zero.” By some estimates, China already takes in 90% of Iran’s oil exports, with Syria, the United Arab Emirates, and Venezuela accounting for much of the remainder. For Iran, China represents a reliable buyer in an unstable market while serving as a steady supplier for a sizeable portion of China’s hydrocarbon imports.
In the face of massive sanctions against Iran and a plethora of sanctions levied against China by the U.S., the use of the Chinese Yuan (RMB) in oil and natural gas transactions has become more frequent. This use of RMB allows China and Iran to bypass Western financial institutions and, consequently, Western regulators. Coupling this currency shift with a strategy of rebranding Iranian cargo as being of foreign origin — Malaysia, for example — China has allowed small, independent oil refineries colloquially known as “teapots” to absorb large quantities of Iranian oil while China’s state-owned enterprises (SOEs) keep their hands clean of sanctioned imports.
China has also enjoyed discounted rates on Iranian oil under the 25-year Cooperation Program that the two countries signed in 2021, saving the People’s Republic billions. As such, China maintains a vested interest in supporting Iran’s oil and natural gas exports, including investments totaling $280 billion into Iran’s oil, gas, and petrochemicals sector under the 25-year cooperation agreement. However, the follow-through on the many terms laid out in the 25-year agreement has been limited.
While energy trade forms the bedrock of the China-Iran partnership, symbolism currently outweighs tangible risks or rewards regarding their cooperation in the military and security domains.
Symbolic Security
China’s decision to pursue enhanced security cooperation with Iran is somewhat ironic. Even in its own backyard, only Qatar has maintained strong relations with the Islamic Republic. Meanwhile, the increasingly assertive positions of powers like Saudi Arabia and the United Arab Emirates have left Iran at odds with its neighbors in the region. As a result, China has maintained a narrative of cautious neutrality rather than properly endorsing Iran’s regional ambitions at the expense of its GCC partnerships.
In March, China, Iran, and Russia held joint naval exercises in the Gulf of Oman, branded as Security Belt-2025. The exercise, in its fifth consecutive iteration, featured live-fire training and maritime security operations. Both sides publicly described the exercise as routine training to safeguard sea lanes and build interoperability. They are symbolically rich in allowing the participating countries to present the image of a united front against increasingly confrontational U.S. posturing, but are less than significant in terms of the practical advancement of military cooperation. Both Chinese and Iranian state-run media have emphasized that the exercises are “not targeted at any third party” and “enhance security rather than threaten stability.”
Iran’s regional alignment, defined by contentious relations with other Gulf powers, makes it a costly ally in matters of defense and security. Despite Iran's claims of defense self-sufficiency, Chinese firms have quietly supplied key components, like missile propellant materials. These transactions have not taken place at the state level, however, leaving China’s ruling elite with plausible deniability in the matter.
Iran’s positioning in the Middle East has suffered in recent months, weakened by the collapse of allied networks in Syria and Lebanon and by ongoing exchanges of fire with Israel. China, aiming to maintain balanced ties across the Middle East, is unlikely to pursue formal military agreements with Tehran amid Iran’s worsening strategic position.
Diplomacy Without Depth
China’s pursuit of stable diplomacy with the broader Gulf region hampers prospects for meaningful advancement in operational cooperation with Tehran. Beneath their projection of unity lie critical divergences: China maintains deep economic ties with Iran’s Gulf rivals, discouraging it from endorsing Tehran’s confrontational foreign policy. It has also adopted a stance of caution regarding Iran’s nuclear endeavors which falls far short of endorsement. These fault lines, though muted in joint statements, demonstrate that the Iran-China partnership remains one rooted in shared resistance rather than shared vision.
Still, these diplomatic signals serve a purpose. Iran reinforces the narrative that it is not isolated but backed by a major power. China has a cost-effective way to assert global relevance while challenging Western norms without overcommitting. Yet beneath the statements and summits, there has been little progress in terms of formal commitments or operational cooperation. Indeed, their cooperation in 2025 reflects a calculated alignment of interests shaped by circumstance, timing, and a shared resistance to Western pressure, not a unified vision.
A Partnership of Performance
China and Iran’s so-called golden year is not a turning point in global alignments. Their cooperation in 2025 has produced tangible benefits, especially on the economic front, and delivered well-timed political theater. However, the deeper patterns have not changed: China continues to mind its broader regional interests, while Iran presses outward to challenge its isolation. These moves broadcast intent, but not the emergence of a durable strategic bloc.
As the golden year rolls on, it is almost certain that China remains focused on larger strategic priorities, particularly its escalating trade war with the U.S., while Iran seeks to position its ties with Beijing as a counterweight to Western pressure. Even where their interests intersect, the underlying imbalances in ambition, leverage, and risk tolerance limit how far this partnership is likely to evolve. Neither side appears willing to take steps that would fundamentally redefine the relationship.
For all its choreography, the China-Iran partnership remains more reactive than deliberate. While the uncertain trajectory of American foreign policy has opened space for powers like China and Iran to assert themselves, their partnership is still uneven and narrowly scoped. The mismatches in economic scale, military investment, and diplomatic priorities suggest that Beijing and Tehran are not elevating a new axis — only navigating parallel frustrations with a system neither fully controls.
Editorial contributions by Rachael Rhine Milliard
The views and information contained in this article are the author’s own and do not necessarily represent those of The Asia Cable.