Less than one week into Operation Epic Fury, Beijing has ordered its top refiners to halt gasoline and diesel exports as the Strait of Hormuz remained paralyzed on Thursday morning. The move exposes how China is one of the biggest losers in a prolonged Hormuz shutdown, with Beijing appearing to brace for an oil shock.

Beijing is scrambling after panicking at the start of the week and calling for an immediate ceasefire in the U.S.-Iran conflict. Since then, Iraq has begun cutting crude oil output, and Wednesday brought another major energy shock: Qatar’s massive LNG export operation declared force majeure, effectively removing about 20% of global LNG supply from the market, with roughly 80% of those volumes normally headed to Asia.

Bloomberg sources say that officials from the National Development and Reform Commission, China’s top economic planner, called for an immediate temporary suspension of refined crude product exports on Thursday. 

Chinese officials told top domestic refiners to halt any new export deals and cancel existing shipments, though jet and bunker fuel in bonded storage, along with supplies to Hong Kong and Macau, are exempt. 

NDRC’s decision is merely viewed as a way for Beijing protect domestic fuel supply and energy security. We’ve made it very well known to readers that China is heavily exposed to Gulf energy. 

We’ve briefed readers (read here) that China is heavily exposed to cheap Iranian crude exports. About 80% of Iran’s oil exports – about 1.6 million barrels per day – go to China.

… and so is the rest of Asia.

We asked a very important question on Wednesday evening: “Will Trump Seize Or Destroy Iran’s Oil Export Island?”

Crude oil futures for April on the Shanghai International Exchange (priced in dollars) are near $100/bbl.

However, there is some good news overnight:

• China-Linked Bulk Carrier Exits Strait Of Hormuz Without Incident

Any sustained closure of the critical waterway could trigger an energy shock in China, hitting first through higher prices and, if the disruption persists, through tighter physical supply. As the world’s largest crude importer, with roughly half of its oil imports linked to Gulf shipments, Beijing faces the risk of chokepoint disruptions. 

All of this comes just weeks before President Trump’s upcoming trip to Beijing, and with the U.S. military likely to provide tanker escorts through the narrow waterway, the leverage Washington appears to have gained ahead of any Trump-Xi meeting looks increasingly well calculated. 

Authored by Christina Comben via cointelegraph,

Leopold Aschenbrenner has built a US stock portfolio heavily concentrated in companies that supply the power and infrastructure behind the artificial intelligence boom.

The former OpenAI researcher, who left the lab’s superalignment team to launch San Francisco-based hedge fund Situational Awareness LP, has expanded it from $383 million in assets in early 2025 to a reported $5.52 billion in equity positions in its latest 13F filing with the US Securities and Exchange Commission.

The fund’s 13F filing for Q4 2025 shows a highly concentrated portfolio built around betting that the real winners of the AI boom won’t be chatbots, but the power plants and data centers that feed them. Situational Awareness reported $5.52 billion in US equity positions across 29 holdings, with a large share of that value clustered in a handful of AI infrastructure names.

Those include graphics processing unit (GPU) cloud provider CoreWeave, fuel cell and power specialist Bloom Energy, Intel, optics maker Lumentum and Bitcoin miner-turned-AI infrastructure play Core Scientific. 

Aschenbrenner first drew attention as a precocious AI thinker after publishing a widely read “Situational Awareness” manifesto on the race to advanced AI, then quickly parlayed that profile into capital. His San Francisco-based AI hedge fund now manages more than $1.5 billion, backed by prominent tech founders, family offices and institutions.

Aschenbrenner has been a substantial net buyer quarter-on-quarter, with Situational Awareness’ 13-F reported US equity and options portfolio increasing from about $254 million in Q4 2024 to more than $5.5 billion by Q4 2025. Over that period, the fund built sizable positions in Bitcoin miners and related energy infrastructure firms including IREN, Cipher Mining, Riot Platforms, Bitdeer and Applied Digital.

Bitcoin miners pivot from hashrate to horsepower

The bet aligns with a broader shift already reshaping Bitcoin mining. After the latest halving squeezed block rewards, large miners have started repurposing their high-density, power-rich sites as AI hosting hubs, treating megawatts and data center space as scarce assets in the new compute economy rather than just hashrate.

Core Scientific, for example, has signed a series of 12-year high-performance computing hosting contracts with AI cloud firm CoreWeave, while MARA acquired a 64% stake in French computing infrastructure operator Exaion, expanding into AI and cloud services.

Situational Awareness disclosed a 9.4% stake in Core Scientific via an amended Schedule 13D, representing 28,756,478 shares with shared voting and disposition power, effectively giving the fund a levered bet on CoreWeave’s expansion and the miner’s pivot from pure Bitcoin to AI and high-performance computing.

At the same time, the fund has taken aim at the other side of the AI transition with a short position in Indian IT giant Infosys, a wager that large language models and AI coding tools will pressure the traditional outsourced software services model.

Goldman analysts, led by Eric Sheridan, updated clients this week on the latest developments in the North American autonomous vehicle rideshare market. They point out that the AV rideshare market continues to expand as Uber, Lyft, Waymo, and Zoox roll out AV operations nationwide.

Readers will notice that the commercial AV deployments this year, including Uber, Lyft, Waymo, and Zoox (Tesla in Texas), are full steam ahead.

Key AV deployment announcements for Uber, Lyft, and Waymo in 4Q25

Key AV deployment announcements for Uber, Lyft, and Waymo YTD 2026

One of the most fascinating charts Sheridan produced for clients shows the miles between accidents for Waymo and Tesla.

Here’s more on the safety data:

Based on available crash data from the National Highway Traffic Safety Administration (NHTSA) from July 2025 through mid-January 2026, and disclosures from Waymo (for all US cities it’s operating in commercially) and Tesla (for Austin) around trips/miles driven by their respective robotaxi services, we estimate that Tesla has an accident (regardless of fault) every 45K-60K miles, while Waymo has an accident (regardless of fault) every 60K-110K miles. We note that these datapoints reflect driverless miles (including those with a safety observer/monitor for Tesla) and do not include manually operated vehicles and accidents in cities without public rides being offered. We show estimated monthly miles between accidents for both companies in Exhibit 1. Note that Tesla’s miles between accidents were ~1.5K miles in July and Tesla did not have any reported accidents in August. Further, note that January data only captures known/reported accidents through January 15th and further accidents are typically reported in the following month’s data (i.e., February data).

Note that because Tesla’s fleet in Austin is a mix of vehicles, both with and without a safety monitor, and because there are differences in where the rides are occurring (with Waymo operating commercially in more cities), the data may not be directly comparable. In addition, reports are filed with NHTSA even for minor issues that would be unlikely to be reported by a human (e.g. driving over a curb), and not all accidents are the fault of the AV.

Goldman has told clients that the AV rideshare buildout is still in its early stages and is set to accelerate from here.

In January, Elon Musk told BlackRock CEO Larry Fink at Davos that Tesla expects to operate a “widespread” robotaxi network by the end of this year.

It is only a matter of time before taxi drivers and human Uber drivers begin to revolt against AVs gaining deeper penetration in the rideshare market. That shift should become increasingly visible over the next several years, with the impact likely to be far more noticeable by 2028 and beyond.

The full Goldman note can be viewed (here) and is available to pro subs.

Goldman analysts, led by Eric Sheridan, updated clients this week on the latest developments in the North American autonomous vehicle rideshare market. They point out that the AV rideshare market continues to expand as Uber, Lyft, Waymo, and Zoox roll out AV operations nationwide.

Readers will notice that the commercial AV deployments this year, including Uber, Lyft, Waymo, and Zoox (Tesla in Texas), are full steam ahead.

Key AV deployment announcements for Uber, Lyft, and Waymo in 4Q25

Key AV deployment announcements for Uber, Lyft, and Waymo YTD 2026

One of the most fascinating charts Sheridan produced for clients shows the miles between accidents for Waymo and Tesla.

Here’s more on the safety data:

Based on available crash data from the National Highway Traffic Safety Administration (NHTSA) from July 2025 through mid-January 2026, and disclosures from Waymo (for all US cities it’s operating in commercially) and Tesla (for Austin) around trips/miles driven by their respective robotaxi services, we estimate that Tesla has an accident (regardless of fault) every 45K-60K miles, while Waymo has an accident (regardless of fault) every 60K-110K miles. We note that these datapoints reflect driverless miles (including those with a safety observer/monitor for Tesla) and do not include manually operated vehicles and accidents in cities without public rides being offered. We show estimated monthly miles between accidents for both companies in Exhibit 1. Note that Tesla’s miles between accidents were ~1.5K miles in July and Tesla did not have any reported accidents in August. Further, note that January data only captures known/reported accidents through January 15th and further accidents are typically reported in the following month’s data (i.e., February data).

Note that because Tesla’s fleet in Austin is a mix of vehicles, both with and without a safety monitor, and because there are differences in where the rides are occurring (with Waymo operating commercially in more cities), the data may not be directly comparable. In addition, reports are filed with NHTSA even for minor issues that would be unlikely to be reported by a human (e.g. driving over a curb), and not all accidents are the fault of the AV.

Goldman has told clients that the AV rideshare buildout is still in its early stages and is set to accelerate from here.

In January, Elon Musk told BlackRock CEO Larry Fink at Davos that Tesla expects to operate a “widespread” robotaxi network by the end of this year.

It is only a matter of time before taxi drivers and human Uber drivers begin to revolt against AVs gaining deeper penetration in the rideshare market. That shift should become increasingly visible over the next several years, with the impact likely to be far more noticeable by 2028 and beyond.

The full Goldman note can be viewed (here) and is available to pro subs.

Via REMIX News,

The wave of police searches and prosecutions in Germany may be facing a new hurdle after Germany’s top court, the Constitutional Court, issued two landmark rulings strengthening freedom of expression. However, Fatina Keilani, editor in Welt’s freedom of expression department, said that these two decisions have gone largely unnoticed by the public, an oversight that she finds remarkable.

Writing in Welt, Keilani reports that the Federal Constitutional Court in Karlsruhe handed down two resolutions in December that push back against what she describes as hasty convictions for insults. The rulings stem from two separate cases in which individuals used sharp, even offensive language against public officials and medical staff — and were criminally sentenced for it.

As Remix News has extensively reported, there have been hundreds, if not thousands, of such cases in recent years. Some of these cases have even attracted international attention and led to questions about freedom of speech and growing repression in Germany.

Just late last month, German prosecutors launched investigations into dozens of comments under just one post criticizing Chancellor Friedrich Merz, with one user calling him “Pinocchio.” A number of constitutional lawyers were quick to slam the investigations, with one labeling it “hysterical madness.”

Now, Germany’s top court is strengthening freedom of expression at a worrying time.

The first case involved a retired police officer whose son attended a high school during the Covid pandemic. Angered by the school’s testing requirements, the father sent the headmaster a series of emails accusing him of serving a “fascist system and its henchmen” and of “fascist cadre obedience.” The Göppingen District Court sentenced him to a fine of 70 daily rates of €80 each for insult. He lost every appeal before taking his case to Karlsruhe — where he finally prevailed.

The Constitutional Court found that his right to freedom of expression had been violated, ruling that the lower courts had not examined the meaning of his statements carefully enough, nor struck an adequate balance between free expression and the protection of personality.

Keilani quotes the court directly: “Part of this freedom is that citizens can attack officials they consider responsible in an accusatory and personalized way for their way of exercising power, without having to fear that the personal elements of such statements are removed from this context and form the basis for drastic judicial sanctions.”

The second case involved a man who had been placed in a psychiatric hospital on multiple occasions and subjected to coercive measures. In a letter to his lawyer in 2023, he described hospital staff as a “psychiatric mob.” When he applied to have the letter formally served, a senior bailiff refused on the grounds that its content was punishable. The Stuttgart Higher Regional Court upheld that refusal — but Karlsruhe disagreed.

The Constitutional Court was pointed in its criticism, noting that the Higher Regional Court’s entire reasoning had been reduced to just two sentences, and that it had made no real weighing of the fundamental right to free expression at all. The case has been sent back for reconsideration.

For Keilani, both rulings carry a significance that extends beyond the individual cases. She situates them within a broader climate of concern, noting that “numerous decisions against freedom of expression have recently raised doubts in Germany about the rule of law and about the stability of the courts with regard to this crucial fundamental right.”

In particular, the wave of politicians weaponizing comments on the internet to launch police raids and drag social media users to court. Against that backdrop, she finds the Karlsruhe decisions reassuring — while also reading them as a firm instruction to lower courts about the standard they must meet when judging speech.

These rulings do not necessarily mean, however, that internet users are now able to freely insult politicians without consequence. For one, prosecutors and politicians still have incentive to pursue such cases, both in order to stifle dissent and to intimidate the populace. Social media users may be able to defend themselves in court, but it will likely take years and cost them substantial amounts of money. Furthermore, outright insults without context are still likely to be prosecutable offenses under current German law. For example, insulting a politician’s physical appearance or simply calling them a slur could land social media users in hot water.

Regardless, the country’s top court has drawn a line in the sand, according to Keilani.

She also cited the “urgent decision of the Cologne Administrative Court regarding the classification of the AfD” as also a welcome sign that rule of law still stands in Germany. In that ruling, the Cologne court found that the designation of the AfD as a “confirmed” case of right-wing extremism was not constitutionally sound.

Via REMIX News,

The wave of police searches and prosecutions in Germany may be facing a new hurdle after Germany’s top court, the Constitutional Court, issued two landmark rulings strengthening freedom of expression. However, Fatina Keilani, editor in Welt’s freedom of expression department, said that these two decisions have gone largely unnoticed by the public, an oversight that she finds remarkable.

Writing in Welt, Keilani reports that the Federal Constitutional Court in Karlsruhe handed down two resolutions in December that push back against what she describes as hasty convictions for insults. The rulings stem from two separate cases in which individuals used sharp, even offensive language against public officials and medical staff — and were criminally sentenced for it.

As Remix News has extensively reported, there have been hundreds, if not thousands, of such cases in recent years. Some of these cases have even attracted international attention and led to questions about freedom of speech and growing repression in Germany.

Just late last month, German prosecutors launched investigations into dozens of comments under just one post criticizing Chancellor Friedrich Merz, with one user calling him “Pinocchio.” A number of constitutional lawyers were quick to slam the investigations, with one labeling it “hysterical madness.”

Now, Germany’s top court is strengthening freedom of expression at a worrying time.

The first case involved a retired police officer whose son attended a high school during the Covid pandemic. Angered by the school’s testing requirements, the father sent the headmaster a series of emails accusing him of serving a “fascist system and its henchmen” and of “fascist cadre obedience.” The Göppingen District Court sentenced him to a fine of 70 daily rates of €80 each for insult. He lost every appeal before taking his case to Karlsruhe — where he finally prevailed.

The Constitutional Court found that his right to freedom of expression had been violated, ruling that the lower courts had not examined the meaning of his statements carefully enough, nor struck an adequate balance between free expression and the protection of personality.

Keilani quotes the court directly: “Part of this freedom is that citizens can attack officials they consider responsible in an accusatory and personalized way for their way of exercising power, without having to fear that the personal elements of such statements are removed from this context and form the basis for drastic judicial sanctions.”

The second case involved a man who had been placed in a psychiatric hospital on multiple occasions and subjected to coercive measures. In a letter to his lawyer in 2023, he described hospital staff as a “psychiatric mob.” When he applied to have the letter formally served, a senior bailiff refused on the grounds that its content was punishable. The Stuttgart Higher Regional Court upheld that refusal — but Karlsruhe disagreed.

The Constitutional Court was pointed in its criticism, noting that the Higher Regional Court’s entire reasoning had been reduced to just two sentences, and that it had made no real weighing of the fundamental right to free expression at all. The case has been sent back for reconsideration.

For Keilani, both rulings carry a significance that extends beyond the individual cases. She situates them within a broader climate of concern, noting that “numerous decisions against freedom of expression have recently raised doubts in Germany about the rule of law and about the stability of the courts with regard to this crucial fundamental right.”

In particular, the wave of politicians weaponizing comments on the internet to launch police raids and drag social media users to court. Against that backdrop, she finds the Karlsruhe decisions reassuring — while also reading them as a firm instruction to lower courts about the standard they must meet when judging speech.

These rulings do not necessarily mean, however, that internet users are now able to freely insult politicians without consequence. For one, prosecutors and politicians still have incentive to pursue such cases, both in order to stifle dissent and to intimidate the populace. Social media users may be able to defend themselves in court, but it will likely take years and cost them substantial amounts of money. Furthermore, outright insults without context are still likely to be prosecutable offenses under current German law. For example, insulting a politician’s physical appearance or simply calling them a slur could land social media users in hot water.

Regardless, the country’s top court has drawn a line in the sand, according to Keilani.

She also cited the “urgent decision of the Cologne Administrative Court regarding the classification of the AfD” as also a welcome sign that rule of law still stands in Germany. In that ruling, the Cologne court found that the designation of the AfD as a “confirmed” case of right-wing extremism was not constitutionally sound.

US Southern Command on Tuesday stated that the US military had conducted a joint operation with Ecuadorian forces against “designated terrorist organizations” in Ecuador, as the Trump administration continues to fight narco-terrorism. 

“We commend the men and women of the Ecuadorian armed forces for their unwavering commitment to this fight, demonstrating courage and resolve through continued actions against narco-terrorists in their country,” Marine Corps Lt. Gen. Francis L. Donovan, commander of U.S. Southern Command, said in a post on X.

The announcement comes after Donovan visited Ecuador on March 1 for a two-day visit, where he met President Daniel Noboa and senior Ecuadorian defense officials in Quito. They discussed security cooperation and US support of Ecuador’s efforts to combat narco-terrorism. 

A Pentagon spox told the Epoch Times that the joint effort does not entail US troops in combat. 

“Ecuador is one of the United States’ strongest partners in disrupting and dismantling Designated Terrorist Organizations in the region,” Donnovan said on Tuesday. “The Ecuadorian people have witnessed firsthand the terror, violence, and corruption that these narco-terrorists inflict on communities across the region.”

Noboa announced on Monday that Ecuador had entered a new phase in its fight against narcoterrorism and illegal mining.

“In the month of March, we will conduct joint operations with our regional allies, including the United States,” he said on X. “The security of Ecuadorians is our priority, and we will fight to achieve peace in every corner of the country.”

As the Epoch Times notes further, the operations come amid increased U.S. involvement in the region, including the capture of former Venezuelan leader Nicolás Maduro in January.

The Trump administration in September 2025 classified two Ecuadorian cartels, Los Choneros and Los Lobos, as foreign terrorist organizations.

“Los Choneros and Los Lobos have attacked and threatened public officials and their families, security personnel, judges, prosecutors, and journalists in Ecuador,” the U.S. State Department said in a September 2025 statement.

On Feb. 2, the U.S. Coast Guard detained three suspected narco-terrorists northwest of Ecuador during Operation Pacific Viper, an ongoing U.S. Coast Guard-led campaign launched in early August 2025, to undermine drug trafficking in the Eastern Pacific Ocean and the Caribbean Sea.

In March 2025, Noboa called for U.S. special forces, with assistance from Brazil and Europe, to dismantle the international narco-terrorist organizations, which have swelled to thousands of armed members.

“We need to have more soldiers to fight this war,” Noboa told the BBC at the time. “Seventy percent of the world’s cocaine exits via Ecuador. We need the help of international forces.”

Ryan Morgan contributed to this report.

US Southern Command on Tuesday stated that the US military had conducted a joint operation with Ecuadorian forces against “designated terrorist organizations” in Ecuador, as the Trump administration continues to fight narco-terrorism. 

“We commend the men and women of the Ecuadorian armed forces for their unwavering commitment to this fight, demonstrating courage and resolve through continued actions against narco-terrorists in their country,” Marine Corps Lt. Gen. Francis L. Donovan, commander of U.S. Southern Command, said in a post on X.

The announcement comes after Donovan visited Ecuador on March 1 for a two-day visit, where he met President Daniel Noboa and senior Ecuadorian defense officials in Quito. They discussed security cooperation and US support of Ecuador’s efforts to combat narco-terrorism. 

A Pentagon spox told the Epoch Times that the joint effort does not entail US troops in combat. 

“Ecuador is one of the United States’ strongest partners in disrupting and dismantling Designated Terrorist Organizations in the region,” Donnovan said on Tuesday. “The Ecuadorian people have witnessed firsthand the terror, violence, and corruption that these narco-terrorists inflict on communities across the region.”

Noboa announced on Monday that Ecuador had entered a new phase in its fight against narcoterrorism and illegal mining.

“In the month of March, we will conduct joint operations with our regional allies, including the United States,” he said on X. “The security of Ecuadorians is our priority, and we will fight to achieve peace in every corner of the country.”

As the Epoch Times notes further, the operations come amid increased U.S. involvement in the region, including the capture of former Venezuelan leader Nicolás Maduro in January.

The Trump administration in September 2025 classified two Ecuadorian cartels, Los Choneros and Los Lobos, as foreign terrorist organizations.

“Los Choneros and Los Lobos have attacked and threatened public officials and their families, security personnel, judges, prosecutors, and journalists in Ecuador,” the U.S. State Department said in a September 2025 statement.

On Feb. 2, the U.S. Coast Guard detained three suspected narco-terrorists northwest of Ecuador during Operation Pacific Viper, an ongoing U.S. Coast Guard-led campaign launched in early August 2025, to undermine drug trafficking in the Eastern Pacific Ocean and the Caribbean Sea.

In March 2025, Noboa called for U.S. special forces, with assistance from Brazil and Europe, to dismantle the international narco-terrorist organizations, which have swelled to thousands of armed members.

“We need to have more soldiers to fight this war,” Noboa told the BBC at the time. “Seventy percent of the world’s cocaine exits via Ecuador. We need the help of international forces.”

Ryan Morgan contributed to this report.

Authored by Andrew Korybko via Substack,

Pakistan could set into motion a sequence of events that restores its role as the US’ top regional ally, returns US troops to Afghanistan’s Bagram Airbase if they later team up against the Taliban, and therefore build a new regional order at the geostrategic crossroads of South and Central Asia.

Saudi Arabia has been attacked multiple times by Iran on the pretext that the US military infrastructure on its territory has been used to some extent in the US campaign against Iran, which led to what can be described as the Third Gulf War, in spite of the Saudi-Pakistani Mutual Defense Pact from last September. Iran clearly wasn’t deterred, but Pakistani Foreign Minister Ishaq Dar still reminded Iran about it in what seems to either be another attempt to deter an escalation or intimate impending involvement in the war.

In his words, “We have a defence pact with Saudi Arabia. I conveyed to the Iranian side about our defence pact, to which he asked me to ensure that KSA’s land was not used. Then I had shuttle communication, as a result of which, as you can compare, the least attacks from Iran are to Saudi Arabia and Oman.” Objectively speaking, it reflects poorly on Pakistan that Iran ignored Dar’s reminder and still attacked Saudi Arabia, hence why he coped that “the least attacks from Iran are to Saudi Arabia”.

Mutual defense pacts are supposed to deter attacks, not simply reduce the number and intensity thereof, which in any case didn’t even happen like Dar claimed since Iran continues to attack Saudi Arabia with gusto. Saudi Arabia and Pakistan are now thrown into the dilemma of either activating their mutual defense pact to significantly escalate the conflict through their joint involvement therein, likely coordinated with their shared US ally if that happens, or tacitly admit that it’s militarily impotent.

The crushing reputational costs of failing to activate their previously hyped-up mutual defense pact place additional pressure upon their policymakers to do so, even if the decision is delayed till after the US and Israel destroy more of Iran’s air defenses and missile launchers to reduce the risks to them. Saudi Arabia hosts US bases and its economy is extremely vulnerable to large-scale disruptions from low-cost drone strikes alone, while Pakistan is a “Major Non-NATO Ally” with very close ties to Trump 2.0.

The aforesaid factors greatly raise the chances of them activating their mutual defense pact. In that case, Saudi Arabia might also lead some of the smaller Gulf Kingdoms that have also been attacked by Iran into battle against it as part of an even larger US-coordinated escalation, which could occur in parallel with Pakistani strikes and/or even limited ground ops on the anti-terrorist pretext of targeting Baloch separatists. Pakistan has three reasons to do this apart from the earlier-mentioned reputational one.

In brief, it wants to restore its role as the US’ top regional partner after India replaced it following the Indo-US trade deal, to which end doing the US a favor in Iran could also be the cover for destroying rival India’s port in Chabahar while improving the odds of them teaming up against the Taliban. Pakistan is actively destroying their leftover US stockpiles, which could facilitate Trump’s desired return of US troops to Bagram Airbase, thus possibly replacing Indian influence in Afghanistan with American and Pakistani.

Therefore, by activating its mutual defense pact with Saudi Arabia after Iran’s attacks against its ally, Pakistan can set into motion a sequence of events for building a new regional order with the US at the geostrategic crossroads of South and Central Asia. This outcome could also see them aid their shared Turkish ally’s challenge to Russia in the latter region along its vulnerable southern periphery. These calculations are compelling enough that Pakistan’s involvement in the Third Gulf War can’t be ruled out.

Authored by Zineb Riboua via Beyond the Ideological,

The men in Zhongnanhai do not rattle easily. Decades of patient statecraft, a foreign policy built on studied ambiguity, and an economy engineered to absorb external shocks have granted Beijing’s leadership a remarkable tolerance for turbulence. Operation Epic Fury, the American-Israeli air campaign now dismantling Iran’s military architecture, has produced something unusual in the corridors of Chinese power: visible confusion.

Xi Jinping is scrambling. The word is not used lightly. For a leader who has built his image on strategic composure and long-horizon thinking, the current moment is acutely dangerous. Not because China faces a direct military threat, but because every available response to the crisis in the Persian Gulf leads Beijing into a trap of its own contradictions.

Three Reasons Operation Epic Fury Is Catastrophic for Xi

First, the Iranian counterweight is gone. In 2021, Xi told senior Party officials that “the East is rising and the West is declining,” that America was “the biggest source of chaos in the present-day world,” and that China was entering a period of strategic opportunity. Iran was central to that thesis. Beijing needed a defiant Tehran to keep Washington pinned down in the Gulf, to sustain a sanctions-proof energy corridor, and above all, to stand as living evidence that American power had hard limits. The entire architecture of CCP’s dogma of inevitability, which rested on Iran’s ability to endure, and Epic Fury removed the foundation in a single afternoon.

Khamenei was the man who made the thesis feel real. Beijing’s relationship with the Islamic Republic was never really ideological, but Khamenei’s survival was the single most useful fact in Chinese foreign policy. Here was a man Washington had threatened, sanctioned, plotted against, and encircled for over four decades, and he was still giving Friday sermons. Xi personally signed the comprehensive strategic partnership with Khamenei’s government. He personally authorized the weapons transfers. And he personally wielded the Security Council veto. None of it kept Khamenei alive for one additional hour once Washington decided he was finished.

Second, Xi’s own story is collapsing from the inside. The story he told 1.4 billion people, that America is a declining power incapable of decisive force projection, does not match what happened in seventy-two hours over Tehran. State media can suppress the footage and the censors can scrub Weibo, but the ones who matter most, the military planners, the foreign policy professionals, the provincial officials who read between the lines for a living, know what they saw. And if the story is wrong about Iran, the unavoidable next question is whether it was ever right about anything else.

Third, the energy math turns against Beijing. China bought 1.38 million barrels per day of Iranian oil last year and takes over 80% of everything Iran ships. Half of China’s total oil imports pass through the Strait of Hormuz. With Ayatollah Khamenei now dead and Iran’s military leadership weakened, the Gulf’s strategic balance shifts decisively toward Saudi Arabia and the United Arab Emirates, whose energy ties with the United States are strengthening. China’s old selling point was very simple and transactional: we buy your oil and never mention human rights. That pitch loses its utility when Gulf producers already feel protected by an American security guarantee that just proved, on live television, that it works.

The Messaging Trap

Xi’s communications problem may be worse than his strategic one, because there is no good answer. If Beijing endorses the strikes, it loses the “Global South.” If Beijing condemns the strikes, it attaches Chinese prestige to a dead man’s regime, and risks provoking a Trump administration that has just demonstrated, through the act itself, that it does not bluff.

So Beijing chose the remaining option: hide behind the United Nations. Mao Ning called the killing “a grave violation of sovereignty.” The language sounds forceful, but the Belt and Road countries are watching, and what they see so far is a confused superpower reading from a script while American carriers do the actual deciding.

Every Iranian Move Is a Chinese Loss

The truly vicious part of Beijing’s situation is that Iran’s entire playbook for retaliation was designed to punish Washington, but the geography and economics of each weapon mean the damage lands on China instead. Iranian missiles aimed at Gulf states threaten the very oil infrastructure and port facilities that Chinese companies have spent billions investing in across the region.

The Strait of Hormuz is worse. Iran’s Revolutionary Guard announced within hours that no ship would pass through the channel, a threat designed as leverage against the West, except that the United States has a shale industry and a crisis-proof strategic petroleum reserve. In fact, according to Kayrros, as of March 31, 2025, China had only filled 56% percent of its above-ground strategic and commercial storage facilities.

Which means that nearly 45% of China’s own oil imports now sit/would sit hostage to a blockade that was never meant to hurt Beijing. The Houthis have resumed attacks on Red Sea shipping, every flare-up in Iraq threatens oil concessions that Chinese companies spent billions building, and the sum of Iran’s resistance amounts to a systematic disruption of Chinese commercial interests across every waterway and energy corridor Beijing depends on, executed in Khamenei’s name, with no regard for who actually pays the price.

Counting Moves

The clearest sign of Beijing’s disorientation is the absence of action: no emergency summits, no diplomatic maneuvers, no military repositioning, even as a Chinese citizen was killed in crossfire in Tehran and over 300 nationals were evacuated. The sum total of Beijing’s response to the largest American military operation in a generation remains a press conference.

Xi bet a decade of foreign policy on Khamenei’s ability to withstand American pressure, and the bet did not pay off. Operation Epic Fury was designed to break the Islamic Republic, but it may also have exposed the uncomfortable truth that Chinese influence in the Middle East was only as durable as the assumption that no one would ever call it into question, and in Zhongnanhai, they know it.