There are a group of islands located in the East China Sea that are the subject of a dispute between two nations. China calls the islands Diaoyu; in Japan, they are known as the Senkaku. Both nations claims sovereignty over the islands. China asserts that they discovered the eight uninhabited islands, and controlled them until the end of the Sino-Japanese War in 1895. Before the war, Japan incorporated the islands into their territory.
Japan control the disputed East China Sea islands until World War II. Following the war, a 1951 treaty with Japan gave the United States rights to administer the islands. That authority reverted back to Japan in 1971. China asserts that the 1951 treaty should have given them control over the islands. In 1969, the United Nations reported that there was a possibility of large oil reserves in the East China Sea near the islands location. China and Japan have been locked in a territorial dispute since the 1970s. Its conflict has escalated in recent times, with citizens from both nations protesting and raising flags on different islands. The countries have launched diplomatic efforts to resolve the issue.
On what basis does China assert its ownership of these islands?