Beijing has threatened retaliation against the US over President Donald Trump’s latest sanctions in Iran that would affect its trading partners.
On Monday, US Treasury Secretary Scott Bessent announced the harsh measures that warned countries still trading with Iran risked being forced out of the dollar-based financial system.
China currently buys about 90 per cent of Iran’s oil, a crucial financial lifeline that is keeping the Islamic Republic afloat, with previous US sanctions straining its companies’ access to US economic markets.
The latest American sanctions promised ‘the toughest sanctions in history’ on 60 individuals, entities and vessels, including those based in Hong Kong and mainland China, however stopped short of specifying Chinese financial institutions.
‘China will take all necessary measures to firmly safeguard its rights and interests,’ the Chinese foreign ministry warned in response to the economic ‘D-Day’ promised by the US sanctions.
‘China has made clear on many occasions its firm sanctions that have no basis in international law or the authorisation of the UN Security Council,’ it further said, according to The Financial Times.
‘The pressing task is to facilitate de-escalation of the situation and return to dialogue and negotiation.’
Experts yesterday claimed that Washington would be wary of how China would react to the sanctions, with any curbs on China’s exports of critical minerals as a result especially sensitive.
President Donald Trump and Chinese President Xi Jinping a state dinner at the Great Hall of the People in Beijing (May 2026)
Last year, Beijing showed how dependant the US was on these resources that are essential to high-tech production, like electric cars, electronics and military weapons, by limiting their exports and bringing American manufacturing to a halt.
As part of a trade war between Trump and Chinese President Xi Jinping, China forced companies to get approval from the government before they were allowed to ship the rare minerals abroad.
Bessent called the move ‘economic coercion’ and a ‘global supply chain power grab’, seeing as China has a global monopoly on the extraction of the rare earth materials, with analysts claiming it was China’s way of demonstrating their bargaining leverage.
Experts have warned that China may similarly react if the US enforces the latest sanctions.
China’s state-owned refiners largely comply with current Iran sanctions, however private companies, referred to as ‘teapots’, are allowed to buy and process Iranian oil.
Earlier this year, the US tried to sanction these private companies although Jinping’s government ordered them to ignore the measures.
Bessent previously urged co-operation from China, although the US blockade of Iran’s ports, renewed in mid-July, has already cut Iranian oil flows to China.
‘No one is above the reach of US sanctions,’ Bessent said when asked about China’s trade ties to Tehran. ‘It is now time for world leaders to make a decision between America and Iran.’
Although Bessent declined to identify the countries that would be targeted or reveal when the penalties would take effect, Tehran expressed confidence that major trading partners would resist Washington’s pressure campaign.
Iranian Economy Minister Ali Madanizadeh yesterday claimed that neither China nor Russia had ‘accepted’ the US measures, predicting that other countries would resist them also.
Iran has also promised retaliation to the sanctions, Madanizadeh adding, ‘We are fully prepared for the US sanctions.’
He told state television: ‘Naturally, the enemies intend to launch an economic terrorist attack on us, but we also have our own tools and know how to play the game. Our defense is no longer so defensive; the enemies should wait for an attack.’
Jinping met with Jordan’s King Abdullah II in recent days where they are believed to have discussed Iran and the war in Gaza, with China’s foreign minister Wang Yi similarly holding talks with his Kuwaiti counterpart.
Beijing’s threats of retaliation come only weeks before Trump and Jinping are set to meet in Washington, where they are expected to discuss prolonging their trade war truce that was agreed in October.
