China’s advantage – A report released Tuesday argues that the standoff around the Strait of Hormuz—triggered after joint US- Israeli strikes on February 28 and Iran’s near-closure of the waterway—has left China comparatively better insulated than other Asian economies, and positi
For a moment, the Strait of Hormuz looked like a simple choke point—until Iran virtually closed it. The move came after a joint US and Israel operation on February 28, when government and military sites were struck and Iran’s supreme leader, Ali Khamenei was killed.
The crisis that followed has sent global energy prices soaring, and Asia has been singled out as especially exposed. But in a report published on Tuesday, a geopolitical consulting firm argues the shock has not landed equally across the region. In its assessment, China is the clear winner.
The report says that before the strait’s closure. roughly 80 percent of the oil and nearly 90 percent of the liquefied natural gas transiting the waterway were headed for Asian markets. along with a significant share of other critical commodities. From there. the researchers tracked economic and political ripple effects across the region’s biggest economies—China. India. Japan. and South Korea—as well as emerging markets across south-east Asia. mapping consequences across manufacturing. energy. and agriculture.
China, the report concludes, weathered the initial disruption better than any regional peer, and could also profit from wider trends triggered by the broader conflict. The firm’s wording is blunt: “China weathered the initial shock better than any regional peer.”
Much of the argument rests on buffers that other countries don’t appear to have in the same scale. The report points to China’s large stockpiles of oil and an increasingly ambitious renewable-energy rollout as reasons it was less exposed to the energy shock than others.
China has long maintained strategic energy reserves. Last year, the report says, it used cheap prices to build even bigger stockpiles. It cites analysis by Erica Downs. a senior research scholar at the Centre on Global Energy Policy. saying China’s crude imports rose from 11.1 million barrels a day to 11.6 million in 2025. with over 80 percent of that increase directed to stockpiles. As of January, China had enough stockpiled supply to cover 104 days of imports at the 2025 level.
Then there is the clean-energy buildout—an area where the report argues China has been able to turn urgency into expansion. It says that last year China installed 315GW of new solar capacity. more than half of the world’s new solar. The year before, it added 277GW. Beijing’s goal, according to the report, is for half of China’s energy to come from non-fossil sources by 2030. The share from wind and solar is projected to reach 30 percent, up from 22 percent in 2025.
Coal still dominates China’s energy mix, the report acknowledges, accounting for more than 50 percent. But renewables are gaining share quickly, and the firm argues that trajectory matters in the middle of an energy disruption.
There is also a political and economic feedback loop. The report says China benefits when other countries respond by accelerating their clean-energy buildouts—and that it is positioned to supply much of what they need. It notes that China dominates global supply chains in solar and other clean technology industries. and that in recent years Beijing has pushed much of that production overseas at low prices. drawing ire from western leaders concerned about their own industries.
The report brings in concrete trade indicators. It says China’s electric vehicle exports soared by more than 110 percent in May compared with the previous year, while solar shipments in April increased by 60 percent.
Still, the story isn’t just about market share. It is also about how Beijing frames the crisis—using the damage to others as evidence of instability caused from outside. The report describes China calling for a ceasefire in the Middle East. It also references Trump’s May visit. during which he met China’s president. Xi Jinping. and claimed the two countries were united in wanting to find a settlement. Yet the firm adds a sharper reading of what Beijing is doing with the moment: “The crisis allows Beijing to cast the United States as the destabilizing actor whose Middle East entanglements impose costs on the world.”.
The report does not ignore the counterpoints. Drew Thompson. a senior fellow at the S Rajaratnam School of International Studies in Singapore. is quoted in the piece warning that the US losing credibility is not automatically a win for China. He says: “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.”.
Another risk comes from the practical realities of operating in a world with contested waters. Wen-Ti Sung. a non-resident fellow with the Atlantic Council’s Global China Hub based in Taiwan. is quoted saying the crisis could make Beijing think twice about a future military assault on Taiwan because it would show how hard it is to navigate ships through hostile territory.
Even with those dangers, the report’s bottom line is that Beijing sees instability less as a terminal threat and more as something to manage. It concludes: “Ultimately Beijing views the pain points not as existential threats, but as challenges to be managed and even opportunities to be exploited.”
What’s striking is how the crisis shifts from a regional security shock into a competition over resilience. With reserves. energy expansion. and clean-tech supply chains already in motion. China appears positioned—at least in this assessment—to turn a standoff that has pushed global prices higher into room to reinforce its economic and strategic leverage. The strait may still be the bottleneck for the world’s oil and gas. but the report argues the ability to stock. diversify. and scale has changed who gets squeezed first—and who can profit from the scramble that follows.
Strait of Hormuz Iran Ali Khamenei United States Israel Trump Xi Jinping China energy reserves solar capacity renewable energy electric vehicle exports clean technology supply chain Asia Group report