A chart of Iran’s petroleum exports from early 2018 to early 2024, produced by the Congressional Research Service in a report titled “Iran’s Oil Exports to China and US Sanctions.” (Congressional Research Service)

China and Iran flaunted their close friendship this week.

At a meeting in Russia aimed at cementing an anti-Western alliance, Chinese leader Xi Jinping welcomed Iranian President Masoud Pezeshkian to Iran’s first BRICS summit as a full member. He also showcased Beijing’s diplomatic and economic alliance with Tehran as the conflict in the Middle East escalates further and Iran prepares for Israeli retaliation for the latest attacks.

“China will unswervingly develop friendly cooperation with Iran,” Xi told Pezeshkian, according to a Chinese government readout. Xi expressed his support for a ceasefire in the Gaza Strip, and the two leaders agreed to work together to “oppose hegemony and bullying”.

But with violence threatening to bring the long-running shadow war between Israel and Iran out into the open, China is unlikely to force Iran to de-escalate, and the relationship between Beijing and Tehran is more limited than it appears.

“China’s relationship with Iran is strategically important, but also limited,” said William Figueroa, a China-Iran expert at the University of Groningen in the Netherlands. “It’s really not this new axis of evil that people are portraying China, Russia and Iran as. It’s actually one of its smaller, smaller relationships in the Middle East, and I think that’s being lost.”

Iran is economically isolated due to a strict international sanctions regime and is dependent on commercial links with China, its largest trading partner. That, along with their shared distrust of the United States, has contributed to stronger political ties.

Iran last year joined the Shanghai Cooperation Organization, a political and economic organization established by China and Russia, with Beijing’s encouragement, and this week was welcomed into BRICS with Beijing’s help. In February 2023, amid both countries’ rising tensions with Washington, Pezeshkian’s predecessor led a large delegation to Beijing in a high-profile state visit. It was the first by an Iranian president in 20 years.

China has seized the opportunity to buy oil cheaply from heavily sanctioned Iran, with Iranian oil exports to China rising more than 25 percent in the first nine months of 2024 compared to the same period last year. Sales hit a record high of 1.66 million barrels per day in August, according to data from Vortexa, an energy analysis firm.

But the two countries’ overall bilateral trade has declined over the past decade and is worse than China’s trade with Iran’s Gulf neighbors. Last year, for example, China’s trade with Iran was only one-seventh of that with Saudi Arabia, according to Chinese trade data.

If Iran and Israel come into direct conflict, China’s oil supply from Iran could be disrupted. But analysts agree that this would not have a catastrophic impact on Beijing, as China can lean on its strategic oil reserves and other suppliers, such as Russia and Venezuela.

“They have a pretty strong hand in terms of being able to put up with this,” said Alex Turnbull, a Singapore-based commodity analyst.

Nevertheless, China has used its economic relations with Iran and other Gulf states to establish itself as something of a power broker in the region.

Beijing last year announced a détente between Iran and Saudi Arabia, surprising Washington, which had been the dominant external dealmaker since the end of the Cold War. It underlined Xi’s ambitions to invest in a greater political presence in the Middle East.

Earlier this year, Beijing, which has increasingly aligned itself with Palestinian leaders since the October 7, 2023 attacks on Israel, announced an agreement between Palestinian factions, including Hamas and Fatah, to boost unity among bitter rivals in the Gaza war.

But the Palestinian accord has come to nothing, and even China’s landmark Saudi-Iran deal reveals the limits of its influence.

“China didn’t do much, basically,” said Ahmed Aboudouh, an expert on Middle East-China relations at the Chatham House policy institute in London. “The Iraqis and the Omanis played a very important role for two years in bringing these sides together, and China just came along and put its big power stamp on the deal and got the photo op.”

China’s influence over Iran remains minimal, analysts say, even as Chinese diplomats have been dispatched to confer with their Iranian counterparts. Wang Yi, China’s foreign minister, meanwhile, told his Israeli counterpart last week that Beijing wants to “play a constructive role to cool down the situation and restore peace in the region.”

Jonathan Fulton, an Abu Dhabi-based expert on Chinese policy towards the Middle East at the Atlantic Council, said China had been “rhetorically very active” but had not produced any tangible results.

China’s approach was more bark than bite, Fulton said. “As in so many other things, the further you get away from its boundaries, the more barking.”

But Beijing, which upholds the principle of “non-interference” in other nations’ affairs, is neither willing nor able to exert influence over Tehran at the current precarious moment, Figueroa said.

“What they’ve done is what they can do,” he said. “They have proposed to all their allies and to the United Nations several times to have some kind of peace summit for diplomatic negotiations. They have called over and over again for a ceasefire. The fact is just that it is not in their power to make any of these things happen .”

Xi this week doubled down on his rhetoric calling for peace in the Middle East.

“As the world enters a new period defined by turbulence and transformation, we are confronted with crucial choices that will shape our future,” he told the BRICS summit on Wednesday. “Shall we allow the world to sink into the abyss of disorder and chaos, or shall we strive to steer it back onto the path of peace and development?”

But for Xi, it may be more important to be seen as striving towards this goal, especially in the developing world, than to successfully broker peace.

Chinese leaders “do not judge success or failure based on whether they successfully brokered an end to the conflict,” said Oriana Skylar Mastro, an expert on the Chinese military at Stanford University and author of “The Rise: How China Became a Great Power.”

“The Chinese see it primarily as leverage and a tool for global influence. And so what really matters to them is … does it improve their image if it looks like they’re playing a mediating role?” she said.

Pei-Lin Wu in Taipei, Taiwan, contributed to this report.