The United States threatened on Wednesday to sanction buyers of Iranian oil and warned it expects China to halt purchases, a move that tightens economic pressure as a US maritime blockade on Iran enters its seventh week and pushes oil prices back above $100 a barrel.
"We have told countries that if you are buying Iranian oil, that if Iranian money is sitting in your banks, we are now willing to apply secondary sanctions," U.S. Treasury Secretary Scott Bessent told reporters at the White House.
The warning comes as the U.S. Treasury targeted Iran's oil transportation infrastructure with new sanctions on more than two dozen entities and vessels. Brent crude, the global benchmark, reacted to the escalating tensions, rising 2.5 percent to trade above $101 per barrel, while global equity markets declined on fears of a prolonged energy supply disruption.
The move aims to cripple Tehran's primary revenue source and represents the "financial equivalent of a bombing campaign," according to one senior official. The key test will be whether China, which has historically purchased more than 80 percent of Iran's shipped oil, complies with the US demands or challenges the blockade. Bessent confirmed a 30-day waiver for Iranian oil at sea, which allowed some 140 million barrels to reach markets, will expire on April 19 without renewal.
China Pushes Back
Beijing issued a sharp rebuke to the US military maneuvers. Chinese Foreign Ministry spokesperson Guo Jiakun described the naval blockade in the Strait of Hormuz as a “dangerous and irresponsible” step that could inflame tensions and disrupt global energy flows. China has consistently voiced its opposition to unilateral sanctions that are not authorized by the UN Security Council.
While rejecting allegations of providing military assistance to Iran, Beijing is attempting to cast itself as a stabilizing force. Chinese President Xi Jinping has put forward a multi-point proposal aimed at restoring stability, calling for respect for national sovereignty and a return to dialogue. This diplomatic positioning mirrors China's strategy during the Ukraine-Russia war, where it presented itself as a neutral party and peace broker, enhancing its global influence.
Geopolitical Chessboard
The escalating conflict is creating clear winners and losers in the global strategic landscape. Analysts conclude that Russia may be the principal economic beneficiary, as constrained oil supplies and soaring prices produce a financial windfall for the Kremlin. The conflict also diverts advanced Western weaponry that might have otherwise gone to Ukraine.
The United States, meanwhile, finds its resources strained and its global leadership questioned. Washington's failure to rally major neutral powers like India and Brazil to its side in the Ukraine conflict appears to be repeating. China is capitalizing on the situation, leveraging its perceived neutrality to expand its diplomatic influence at Washington's expense, a pattern observed during its successful mediation between Saudi Arabia and Iran in 2023. With Pakistan also emerging as a key mediator for potential US-Iran talks, the diplomatic arena is becoming increasingly multipolar.
This article is for informational purposes only and does not constitute investment advice.
