US Report: China Providing Rocket Fuel and Drone Technology to Iran

A comprehensive report by the US-China Economic and Security Review Commission has detailed an intensifying military partnership between Beijing and Tehran. The findings indicate that China is actively supplying Iran with critical raw materials for rocket propellant and advanced drone technology. According to the commission, this cooperation is Importantly bolstering Iran's domestic missile production and its offensive capabilities in the Middle East, while the report surfaces at a time of heightened regional tensions and increasing international scrutiny over Iran's defense infrastructure.

Supply of Sodium Perchlorate for Missile Production

The report highlights the transfer of large quantities of sodium perchlorate from China to Iran, a chemical essential for manufacturing solid-fuel rockets. Data suggests that in January 2025, China exported approximately 1000 tons of this precursor to Iran. On top of that, the commission tracked two Iranian government-linked vessels departing from China's Gaolan Port in early March 2026, which were suspected of carrying materials related to rocket propulsion systems. This chemical is vital for the range and stability of ballistic missiles, providing a significant boost to Iran's long-range strike capabilities.

Integration with BeiDou Navigation Satellite System

A critical aspect of the bilateral cooperation involves Iran's access to China's BeiDou Navigation Satellite System (BDS), while the report claims that as of 2021, China granted the Iranian military full access to the system's high-precision services. This integration allows Iranian drones and missiles to achieve greater accuracy during strikes, reducing reliance on the US-controlled Global Positioning System (GPS). By utilizing BDS, Iran gains a more resilient navigation framework that's less susceptible to Western interference or jamming during active conflicts.

Direct Arms Negotiations and Anti-Ship Missiles

According to the US findings, China was engaged in direct negotiations to sell advanced weaponry to Iran as recently as February 2026. The report specifies that a deal for anti-ship cruise missiles was nearly finalized just before regional escalations involving US and Israeli strikes. While the specific delivery schedule remains unconfirmed, these negotiations signal a departure from Beijing's previous caution regarding the direct sale of lethal hardware to the Iranian regime. This shift indicates a move toward a more overt defense trade relationship between the two nations.

Strategic Coordination through SCO and BRICS

The military relationship is being further institutionalized through multilateral platforms such as the Shanghai Cooperation Organization (SCO) and BRICS. The report notes that in December 2025, Iran hosted a joint military exercise under the SCO framework, which facilitated deeper operational coordination between Chinese and Iranian forces. These forums provide a diplomatic and security architecture that allows both nations to bypass Western-led sanctions and align their defense policies. Such exercises enable both militaries to share tactical intelligence and develop interoperability in complex combat scenarios.

Shift in China's Military Export Stance

Historically, China maintained a degree of separation from Iran's military sector following the 2015 United Nations resolutions. However, the commission observes a strategic shift where Beijing is now providing military-grade technology and dual-use capabilities through less restrictive channels, while this evolution in policy reflects a broader trend of Chinese support for Iranian defense infrastructure amidst heightened geopolitical competition with the United States. Analysts suggest that Beijing views Tehran as a key partner in balancing regional power dynamics and securing its long-term energy interests.