Red Sea crisis: In a dramatic development, Chinese officials on Friday issued an ultimatum to Iran - either halt the Houthi attacks on commercial and merchant vessels in the Red Sea, or risk harming business relations with Beijing - according to four Iranian sources and a diplomat aware of the matter. The Iran-backed group have launched a series of attacks in the Red Sea that pushed tensions to a boiling point in the Middle East amid the Israel-Hamas war.
According to Iranian sources, the discussions about the Houthi attacks and trade between China and Iran took place at several recent meetings in the capitals of both countries, although it was not revealed when or who attended the talks. "Basically, China says: 'If our interests are harmed in any way, it will impact our business with Tehran. So tell the Houthis to show restraint'," an Iranian official told Reuters on the condition of anonymity.
However, Chinese officials did not make any specific comments or threats about how Beijing's trading relationship with Iran could be affected if its interests were damaged by Houthi attacks, the four Iranian sources said. While China has been Iran's biggest trading partner for the past decade, the trade relationship has its share of challenges.
Chinese oil refiners bought over 90 per cent of Iran's crude exports in 2023 at heavy discounts due to sanctions imposed by the United States that kept customers away, according to tanker tracking data from trade analytics firm Kpler. On the other hand, Iranian oil could only account for 10 per cent of China's crude imports and Beijing has an array of suppliers that could plug shortfalls.
Beijing warns against attacks on Chinese vessels
The Houthis have expressed solidarity with Palestinians and say their attacks aim to end the pounding Israeli air-and-ground offensive targeting the Gaza Strip, even expanding their targets to include American ships, against Washington's backing of Israel in the war. The attacks have disrupted global shipping and stoked fears of global inflation, along with concerns over the expansion of the Israel-Hamas war.
The Iranian sources said Beijing had made it clear it would be very disappointed with Tehran if any vessels linked to China were hit, or the country's interests were affected in any way. Although China is important for Iran, the latter has proxies stationed in Gaza, Lebanon, Syria and Iraq, besides the Houthis in Yemen, and its regional alliances and priorities played a major role in its decision-making.
"China is a sincere friend of the countries of the Middle East and is committed to promoting regional security and stability and seeking common development and prosperity. We firmly support Middle Eastern countries in strengthening their strategic independence and uniting and collaborating to resolve regional security issues," said China's foreign ministry in response to questions on meetings with Iran over the Red Sea attacks.
China's influence on Iran
A senior US official said Washington had asked China to use its leverage with Iran to persuade it to restrain the Houthis, including in conversations Secretary of State Antony Blinken and National Security Advisor Jake Sullivan had this month with senior Chinese Communist Party official Liu Jianchao. However, these requests were not mentioned in China-Iran meetings, said the sources.
On January 14, China's foreign minister Wang Yi called for an end to attacks on civilian ships in the Red Sea - without naming the Houthis or mentioning Iran - and the maintenance of supply chains and the international trade order. Victor Gao, former Chinese diplomat and chair professor at China's Soochow University, said China, as the world's biggest trading nation, was disproportionately affected by the shipping disruption and restoring stability in the Red Sea was a priority.
However, Gao said Beijing would view Israel's treatment of the Palestinians as the root cause of the Red Sea crisis and would not want to publicly ascribe blame to the Houthis. A diplomat familiar with the matter said China had been talking to Iran about the issue but it was unclear how seriously Tehran was taking Beijing's advice.
Houthi spokesman Mohammed Abdulsalam said on Thursday that Iran to date had not conveyed any message from China about scaling back attacks. "They will not inform us of such a request, especially since Iran's stated position is to support Yemen. It condemned the American-British strikes on Yemen, and considered Yemen's position honourable and responsible," he said.
China's influence on Tehran was evident in 2023 when it facilitated an agreement between Iran and regional rival Saudi Arabia to end years of hostilities. However, Beijing's influence on Tehran's geopolitical decisions was not absolute, one of the Iranian insiders said, as some in the establishment questioned the value of the friendship given the relatively low non-oil trade since both countries signed a 25-year cooperation agreement in 2021.
Military strikes on Houthis
Military strikes by US and British forces on Houthi targets in Yemen this month have failed to stop attacks on shipping by the group, which controls a large chunk of Yemen including the capital Sanaa and much of the country's Red Sea coast by the Bab al-Mandab strait.
The US and British forces conducted a second joint attack against the Iran-aligned Houthis in Yemen on Monday, targeting a Houthi underground storage site along with missile and surveillance capabilities in eight locations, according to the Pentagon. This marked the eighth time the US has carried out attacks against the Houthis and the second time the UK has participated in them.
The targets included missile systems and launchers, air defense systems, radars, and deeply buried weapons storage facilities, which were used by the Yemen-based group to attack merchant vessels and US Navy ships in the Red Sea, Bab Al-Mandeb Strait and the Gulf of Aden. The joint operation came about 10 days after US and British warships and fighter jets struck more than 60 targets in 28 locations.
(with inputs from Reuters)
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