ISIS are in the north. the oil fields are in the South.
I would guess that ISIS will find it a lot harder to gain ground in the South.
This situation is of course horrible, but it does present some extremely good opportunities for creating a better relationship with Iran (either by USA or China) and tacitly supporting the breaking up of Iraq to include a separate Kurdistan, which as long as it doesn't screw up Turkey would be a good thing.
I'm not at all sure that Iraq as a country is a terribly good idea anyway. I heard the other day that the last time the Sunnis and Shias successfully shared power there was about 1,100 years ago.
Not that anything's that simple of course, but what else exactly is China supposed to do?