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The war with Iran could ultimately prove more costly for the United States than initially expected. Not primarily because of rising oil prices, inflationary pressures or volatility in equity markets, but because one of the structural pillars of U.S. dominance in global trade may be starting to erode: the petrodollar system. “China has remained strikingly restrained so far, despite the strategic relevance of Iranian oil for its energy supply,” says Thorsten Fischer, Managing Director and Head of Portfolio Management at Moventum AM. “Yet it could ultimately emerge as the biggest beneficiary of the crisis if years of strategic preparation begin to pay off and the yuan increasingly positions itself as an alternative to the U.S. dollar in global trade.”

China appears to be pursuing a strategy of strategic patience. While the current escalation ties up significant political, military and financial resources of the United States, Beijing presents itself as a stable and predictable alternative. Conflicts in the Middle East have always been costly, but rarely have they destabilized such a critical global hub for energy and trade as profoundly as the current confrontation. “For strategic competitors such as China, this creates a classic geopolitical window of opportunity,” Fischer says. “Precisely because China is not taking sides directly—or even intervening militarily—it can still benefit indirectly, for example through economic or institutional alternatives.”

At the same time, economic policy concerns within the Gulf region appear to be growing. According to reports, representatives from Saudi Arabia, the United Arab Emirates, Kuwait and Qatar have internally discussed the economic implications of the current conflict environment. “Key issues include rising defense and security spending, potential disruptions to trade flows, as well as pressure on tourism, aviation and energy exports,” Fischer explains.

Several Gulf states are also reviewing ongoing investments and future capital commitments in order to limit potential economic damage should the conflict escalate further. “Large-scale capital reallocations cannot be ruled out in such an environment,” Fischer says.

The implications of such considerations would be significant. The sovereign wealth funds of the Gulf monarchies are among the largest pools of capital in the world. Only recently, they had signaled investment commitments of several hundred billion U.S. dollars in the United States. “Any reassessment of these capital flows could have immediate repercussions for global financial markets,” Fischer notes. “It would also affect cooperation with the United States, whose current approach is increasingly perceived as risky and potentially threatening to the Gulf states’ economic models.”

There is also a strategic dimension to this development. Historically, the Gulf monarchies have formed the foundation of the so-called petrodollar system. Since the 1970s, the majority of global oil trade has been settled in U.S. dollars. “This arrangement has been a key factor in cementing the dollar’s role as the dominant global reserve and trading currency,” Fischer says. “However, if major energy exporters begin to diversify their economic partnerships more broadly, the global currency architecture could gradually become more multipolar.”

China has been preparing for such a scenario for years. Through its Belt and Road Initiative, it has built an extensive infrastructure network spanning more than 150 countries, including ports, railways, highways, power grids, fiber-optic cables and logistics hubs. This physical infrastructure creates long-term economic ties and facilitates integration into Chinese supply chains and financing structures.

At the same time, China is developing institutional alternatives to the Western-dominated financial system. “With the Cross-Border Interbank Payment System, or CIPS, China has established a platform that allows international transactions to be processed outside traditional SWIFT-based structures,” Fischer says. “At the same time, the expanded BRICS group is gaining relevance. It now includes several major energy exporters, potentially creating a counterweight to established Western economic institutions.”

A symbolic milestone occurred in 2023, when Saudi Arabia began settling part of its oil exports to China in Chinese yuan. While volumes remain relatively limited, the signal is clear: even core actors of the existing system are increasingly exploring alternative options.

While the United States has invested enormous financial resources in military engagements in the Middle East over the past two decades, China has largely focused on economic integration and infrastructure connectivity. “Africa in particular has been a central focus, as it is seen as offering some of the largest long-term growth opportunities,” Fischer says. “The strategic approach is clear: less direct geopolitical confrontation, and instead long-term economic integration.”

Against this backdrop, Beijing’s silence in the current conflict appears less like passivity and more like a calculated form of strategic patience. “Every geopolitical escalation that strains alliances, destabilizes energy markets or redirects capital flows could indirectly strengthen exactly the alternative economic architecture that China has been systematically building for two decades,” Fischer says. Or, as a famous maxim often attributed to Napoleon puts it: “Never interrupt your enemy when he is making a mistake.”