Despite supplying 90% of its oil exports to China, Iran is weakened now: Helen Thompson
Helen Thompson
is Professor of Political Economy at
Cambridge University
. Speaking to Srijana Mitra Das, she discusses Iran — and why the Tehran conflict is occuing.
Q. What is the core of your research?
A. Over the last 10 years, my work has primarily focused on the geopolitics and political economy of energy, which includes both fossil fuels and the
energy transition
. I'm also interested in the historical impact energy has had on economic life around the world and democratic politics, particularly in Western countries.
Q. Where does Iran earn its resources from, despite decades of sanctions?
A. Since 2018, when Donald Trump withdrew from the 2015 Iran nuclear deal, Tehran has been principally exporting oil to China — around 90% of Iranian oil exports go there. The fact that the United States being unable to deter Beijing from importing from Tehran is central to the Iranian regime's ability to have some sort of an economic foundation.
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Before that, the sanctions regime on Tehran, although in place since the 1980s, wasn't particularly harsh on oil exports. It took quite a lot of persuasion for the European Union to sign up to the sanctions Barack Obama pushed in 2011-2012 because European governments were too concerned about oil prices to contemplate serious restrictions on Iran — Obama convinced them the US shale oil boom meant despite sanctions, oil prices wouldn't get too hard.
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Q. Is this conflict now basically a scramble for Iran's oil?
A. I don't think there is fundamentally a scramble for Iran's oil resources going on — although Iran's position as an oil exporter and a state on the Persian Gulf is of immense geopolitical significance.
Two current factors are key here. First, Iran's strategic position has deteriorated greatly since the Hezbollah pager attacks — that was the turning point. Tehran had problems post the October 7, 2023 attack. But what changed things was this threat from Hezbollah — which constrained not just Israel but other actors in the region and the US — was eliminated in 2024. There was also the end of the Assad regime in Syria then — and the Russians didn't come to the rescue then. That was another defeat before Israel's air attacks began. There is the Trump factor too — although Donald Trump has an aversion to America actually going to war, he's consistently said Iran can't have nuclear weapons. I think when he stated there were '60 days to negotiate', he meant it. It seems Tehran thought it could drag out negotiations like before — that turned out to not be the case. Iranian leadership made an error of judgement — that gave Benjamin Netanyahu an opportunity to start serious attacks.
Q. What are the implications for oil prices now?
A. There's been some market responsiveness — it hasn't always been prices going up. It's also been prices coming down when tensions seem lowered or there appears less likelihood of the US becoming very seriously involved. Threats by the Iranian government around closing the
Strait of Hormuz
also raise oil prices, although there's some bluffing because the Iranians are actually quite dependent on Oman to impact anything effectively there. Despite many threats made over the years, Iran has never actually closed the Strait. Regime change would have a more deleterious effect on oil prices.
Q. How would that impact China and Russia?
A. They're in a very difficult position — Vladimir Putin has apparently made a strategic judgement that Russia won't go to Iran's aid. The Chinese have been relatively quiet, compared to what could have been said. Given that Iran is a very significant partner for China on energy and Beijing has tried to invest a lot in Iran, regime change in Tehran would be worrying, including for the 'China-Russia-Iran axis'. The last 18 months reflected the China-Russia part of that is quite firm — in many ways, the Ukraine war deepened it. However, the Iran part has become a lot more complicated because Iran is declining while Turkey is the rising power in the Middle East. How Ankara fits into all this will be important for China.
Q. How will the energy transition now proceed?
A. That is really hard. If it were to succeed — and that's the language used in Britain because it's a legal commitment to net zero by 2050 — that would mean effectively reconfiguring the entire material basis of our civilisations.Nothing like this has ever been tried in human history. The Industrial Revolution only added coal to existing energy sources. There are countries in the Global South where the transition to coal hasn't even happened at scale. So, the immensity of this must be understood.
In practice, this means decarbonising electricity rather than electrifying parts of the economy that run on fossil fuels. There's been some success but observing how, say, solar power is generating electricity in China, it's nothing like the capacity China actually has — hydropower does more there. Northern Europe depends climatically on wind but offshore wind is more expensive than solar and the technology for adequate storage isn't here yet. So, the energy transition will take time — while producing economic, political and geopolitical difficulties.
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