U.S. Treasury Secretary Scott Besant announced plans to unveil a new economic sanctions strategy aimed at destabilizing the Iranian regime during a press conference on August 24. Attention is focused on whether China, the largest buyer of Iranian oil, will participate in these sanctions.
In a CNBC interview on August 20, Besant described the upcoming sanctions as the most severe in history, likening them to a "one-two punch" following the ongoing maritime blockade. He urged allies to choose between siding with the U.S. or opposing it, emphasizing that China's reliance on the Gulf region for 50% of its energy makes the stability of the Strait of Hormuz beneficial for its interests. When asked if China would be included in the sanctions, he replied, "Some discussions are better kept private," avoiding a direct answer.
China is viewed as a crucial supporter of Iran's economy. According to Iranian customs data, Iran exported an average of 1.6 million barrels of oil per day in 2024, with 90.8% (1.46 million barrels) going to China. This amounted to $11.8 billion, representing 4% of Iran's GDP of $310.1 billion.
In 2010, Iran exported oil to over 20 countries, with China accounting for only 19% of its exports. However, after the U.S. imposed economic sanctions on Iran in 2011, most countries ceased purchasing Iranian oil. China, however, continued to import oil from Iran, and if it does not comply with U.S. sanctions, the effectiveness of these measures is likely to be limited. Max Maizlish, a researcher at the Foundation for Defense of Democracies, referred to China as Iran's "primary partner in evading sanctions," stating that without Chinese support, Iran would struggle to sustain its war efforts.
Analysts suggest that China is unlikely to join U.S. sanctions this time, as it has previously deemed U.S. actions against Iran illegal. Chinese Foreign Minister Wang Yi met with Iranian Deputy Foreign Minister Abbas Araghchi in May, labeling U.S. and Israeli attacks on Iran as unlawful and calling for an immediate ceasefire.
Following U.S. sanctions targeting Chinese companies like Hengli Petrochemical, the Chinese Ministry of Commerce issued a directive on May 2 instructing domestic firms not to recognize or comply with U.S. sanctions. This marked the first activation of the "Blocking Statute" established in 2021 to counteract the extraterritorial application of foreign laws. The People's Daily, the official newspaper of the Chinese Communist Party, commented on this, asserting that it would defend the rights of Chinese companies against U.S. overreach.
Moreover, China has developed methods to circumvent U.S. sanctions. Its shadow tanker fleet has been transporting sanctioned oil to China, and smaller private refineries have been purchasing oil without engaging in dollar transactions, thus avoiding U.S. financial sanctions.
However, some speculate that if the U.S. offers corresponding incentives, China might consider joining the sanctions. Robin Mills, CEO of Dubai-based energy consulting firm Qamar Energy, noted that China could leverage its purchases of Iranian oil in U.S.-China trade negotiations, linking the issue to core Chinese interests in Taiwan and the South China Sea.
* This article has been translated by AI.
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