Assessing the Impact of International Conflicts on China’s Energy Security and Economic Growth: Evidence from U.S. Economic Sanctions on Iran

Abstract

International conflicts have become a significant source of uncertainty for global energy markets, particularly for energy-importing economies such as China. This study investigates the impact of international conflicts on China’s energy security and economic growth, using the United States' economic sanctions on Iran as a case study. The research examines how sanctions disrupt global oil supply chains, influence energy prices, and affect China’s energy imports and overall economic performance. Drawing on trade and energy security frameworks, the study analyzes the transmission mechanisms through which geopolitical tensions influence energy availability, industrial production, and economic growth. The findings suggest that U.S. sanctions on Iran create supply-side pressures in international oil markets, leading to increased energy price volatility and heightened risks to China’s energy security. The results further indicate that reduced access to Iranian energy resources can negatively affect industrial output, trade activities, and economic growth, particularly in energy-intensive sectors. However, diversification of energy import sources and strategic energy reserves can partially mitigate these adverse effects. The study highlights the importance of strengthening energy cooperation, enhancing supply chain resilience, and promoting alternative energy development to reduce vulnerability to geopolitical conflicts. The findings provide valuable policy insights for China and other energy-importing countries facing increasing geopolitical uncertainties in global energy markets.