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Alessandro Arduino

US President Donald Trump hailed the agreement with Iran as a historic breakthrough, announcing the reopening of the Strait of Hormuz and the end of the American naval blockade.
Trump claimed that, with a 14-point memorandum, he had secured lasting peace for the entire region, using the kind of triumphalist language he has often deployed in the past, from Gaza to Ukraine.
But, as is so often the case in international diplomacy, the real success of any agreement lies in the details. For now, the details remain shrouded in fog. Tehran and Washington have each fed the memorandum into their own narrative machine, stripping it for parts and presenting the wreckage as proof that they, and not the other side, emerged from the conflict victorious.
Amid this uncertainty and extreme volatility, China has seemingly decided to bet on two winners: the immediate tactical victor, Iran, and the longer-term strategic beneficiary, by virtue of geography, the Sultanate of Oman.
This comes as the Strait of Hormuz appears destined to become yet another frozen Middle East conflict: contained, but not resolved, in perpetual crisis rather than lasting peace.

In all likelihood, any follow-on agreement to the 14-point memorandum between Washington and Iran’s theocracy will look less like a historic turning point than a return to the past. The memorandum already revives, in point eight, several elements of the 2015 Iran nuclear deal negotiated by the Obama administration and loathed by Trump.
At the centre of the arrangement would once again be the temporary containment of Iran’s nuclear programme through limits on uranium enrichment, in exchange for economic relief, the suspension of sanctions and security guarantees.
Rather than ushering in a new era of regional stability, the agreement risks freezing tensions and once again postponing the strategic questions that fuel the confrontation between Tehran, Washington and the rest of the Gulf.
This time, however, Iran has a new instrument of pressure. Point five of the memorandum marks a significant shift for passage through the strait: “The Islamic Republic of Iran will initiate a dialogue with the Sultanate of Oman to define the future administrative framework and management of maritime services in the Strait of Hormuz, in consultation with the other states of the Persian Gulf, in accordance with applicable international law and the sovereign rights of the coastal states bordering the Strait of Hormuz.”
In this scenario, Oman also emerges as a winner – a fact not lost on Beijing.
Traditionally regarded as a peripheral actor in Gulf geopolitics, the sultanate now finds itself in a privileged strategic position. Not only does it share control over the maritime routes through the Strait of Hormuz with Iran, it can also offer other Gulf monarchies a land-based alternative for oil and gas pipelines to the Indian Ocean.

It is within this context that China has increased its long-term investments and partnerships with the sultanate, hedging its position while still maintaining its wager on Tehran.
This is a clear example of the “balanced vagueness” of Chinese foreign policy: backing all sides while preserving room for manoeuvre through economic diplomacy. Iran remains a strategic partner and a pillar of the Belt and Road Initiative in the Middle East, while China remains a lifeline for the Iranian economy.
Yet the gulf between the levels of Chinese trade and investment on either side of the waterway is nothing short of vast. Even accounting for undeclared Iranian oil exports, China-Iran trade in 2025 stood at roughly US$41 billion – a fraction of the more than US$300 billion in trade between China and the Arab Gulf states.
The figures confirm that, while Iran retains strategic relevance for Beijing, it occupies a secondary economic position compared with the Gulf monarchies, which remain China’s preferred commercial partners in the Middle East.
Turning to a possible restart of the Iranian economy, point six of the memorandum refers to a potential reconstruction fund for Iran, developed by the United States and Gulf countries, worth no less than US$300 billion.


But there are no clear indications about how such a mechanism would actually operate, as was also the case with the proposed fund for Gaza. Iran itself has doubts and is looking to Beijing. It is no coincidence that, immediately after the conflict, Tehran sent one of its most trusted negotiators to China, hoping to encourage Beijing to become the main partner in reconstruction.
The objective is to revive the much-celebrated Sino-Iranian cooperation agreement, signed in 2021 but never fully implemented, and to attract the capital needed to rescue an economy battered by conflict, sanctions and domestic crises that are far from resolved. Yet between Iranian expectations and Chinese reality there remains a deep divide.
On the other side of the strait, China has been steadily expanding its footprint in Oman for several years, from solar power projects to industrial parks, maritime logistics hubs and joint investment initiatives involving Omani financial authorities linked to Central Asian transport corridors.
As Beijing draws closer to Muscat, Oman finds itself with an opportunity to balance its foreign policy between two global powers, China and the US, and between the regional poles of the Gulf states and Iran.
And how has Trump responded to these developments? With a warning to the sultanate, a long-time American ally: “Oman will behave just like everybody else, or else we’ll have to blow them up.”
Dr Alessandro Arduino is an affiliate lecturer at the Lau China Institute, King’s College London, specialising in the convergence of technology, innovation and national security


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This Week in Asia

Opinion

Behind the triumphalism, an eerily familiar agreement hands Muscat a privileged position that Beijing hasn’t missed


Behind the triumphalism, an eerily familiar agreement hands Muscat a privileged position that Beijing hasn’t missed.


US-Iran tensions

Donald Trump

Oman

Diplomacy

Iran

War and conflict

China

United States

China-Iran relations

Expresses the views, ideas and conclusions of the author. (Eg. Enough of Crazy Rich Asians, think of crazy poor Hongkongers.)


.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}Behind the triumphalism, an eerily familiar agreement hands Muscat a privileged position that Beijing hasn’t missed

Behind the triumphalism, an eerily familiar agreement hands Muscat a privileged position that Beijing hasn’t missed