Trump’s new economic squeeze on Iran has a big challenge: China

The U.S. Treasury Department has intensified its economic pressure on Iran through a series of measures targeted at Iran's financial networks worldwide. However, Beijing, Iran's largest trading partner and leading oil buyer, poses a significant challenge to the success of these efforts. As Treasury Secretary Scott Bessent declared an "economic onslaught" against Iran's financial connections around the world, China remains a key player in the equation.

While the U.S. aims to isolate Iran, President Trump is set to host Chinese President Xi Jinping next month, in an attempt to maintain a fragile trade truce between both nations. Some analysts argue that China will likely respond cautiously, taking only the minimal steps necessary to cooperate with the U.S. without openly violating any red lines.

China has consistently maintained that its cooperation with Iran is within the framework of international law. The Chinese government has expressed opposition to "illegal unilateral sanctions" and stressed the need to safeguard its own rights and interests. In response to the "Operation Economic Outcast," Beijing stated that China's cooperation with Iran has always been within international legal boundaries.

However, China has also acknowledged the need to demonstrate its cooperation, such as by cutting back on its oil imports from Iran. With the planned summit between Trump and Xi Jinping, both sides are wary of causing a major escalation. Analysts suggest that China is likely to offer concessions to the U.S., while the U.S. may refrain from imposing sanctions on major Chinese businesses or banks.