Trump Needs China to Win His Economic War on Iran — Good Luck With That

Beijing holds the key Trump needs

Donald Trump is turning economic pressure into his latest weapon against Iran — but there is one enormous problem.

China.

Treasury Secretary Scott Bessent has warned that countries continuing to do business with Iran could face punishing new sanctions under Washington's so-called “Operation Economic Outcast”.

But Beijing is precisely the country Washington needs to bring on board.

China buys the overwhelming majority of Iran's oil exports and has maintained a crucial economic lifeline to Tehran throughout the conflict. Cutting that lifeline could significantly increase pressure on Iran.

The chances of China simply doing what Trump wants, however, look decidedly slim.

Xi has little reason to help Trump

Beijing has rejected Washington's unilateral sanctions for years and insists China has the right to trade with countries including Iran and Russia.

China's Foreign Ministry responded to Bessent's latest threats by warning that Beijing would take “all necessary measures” to protect its legitimate interests.

The message was clear: China does not accept Washington deciding who Chinese companies are allowed to trade with.

That makes Trump's economic war considerably more complicated.

The sanctions weapon has limits

Washington does have ways of hurting Chinese companies involved in Iran's oil trade.

Iranian crude reaches China through a deliberately opaque network involving smaller “teapot” refineries, tankers, ports and financial arrangements designed to stay outside the US dollar system.

But Washington risks hitting something much bigger if it goes after major Chinese banks or state-linked companies.

Beijing could retaliate — potentially putting Trump's already fragile relationship with Xi Jinping under serious strain.

And there is an awkward timing problem.

Xi is expected to visit the United States next month for a major summit with Trump, with both sides also trying to preserve a fragile trade truce.

China has its own price

Beijing has little interest in becoming an American sanctions enforcer.

But China does have a strong interest in ending the Iran conflict.

The war has disrupted shipping through the Strait of Hormuz, threatened energy supplies and damaged the wider trading environment on which China's economy depends.

Xi has therefore called for the restoration of normal passage through Hormuz and a broader political settlement.

China is also presenting itself as a potential force for stability rather than another participant in Washington's maximum-pressure campaign.

Trump needs Xi — and Xi knows it

That leaves Trump with an awkward calculation.

Washington can threaten Chinese banks, shipping companies and oil buyers. But the harder Trump pushes, the greater the risk that Beijing retaliates and the upcoming Trump-Xi summit becomes a crisis-management exercise rather than a diplomatic breakthrough.

China may quietly reduce Iranian oil purchases, encourage Tehran towards negotiations or help restore shipping through Hormuz.

But there is an important difference between helping end the war and helping Trump win it.

Beijing appears perfectly happy with the first.

The second?

Good luck with that.

SOURCE