US-Iran Confrontation Shifts to Economic Warfare: Can China Be Isolated?
US President Donald Trump has issued an ultimatum to the world on Iran, threatening economic consequences for countries and companies that continue to provide Tehran with a financial 'lifeline'. The move is aimed at cutting off Iran's remaining major trade channels and sources of foreign-currency revenue.
The US strategy is centered around oil shipments, financial transfers, currency exchanges, shipping registries, intermediary structures, and other mechanisms allowing Tehran to circumvent restrictions. If military pressure fails to force Iran to accept US terms, the White House seeks to shift the confrontation from the battlefield to finance, trade, and energy.
The problem is that it's impossible to truly isolate the Iranian economy without affecting China, which has been buying over 80% of Iran's seaborne oil exports since 2025. A significant portion of those shipments went to independent Chinese refineries, known as 'teapot' refineries, which have become a key mechanism for Tehran to preserve oil revenues despite US sanctions.
The US is putting pressure on other countries to choose between economic relations with Iran and access to the US financial system. For most countries, this choice is relatively straightforward, but for China, it's not. The US has repeatedly imposed restrictions on Chinese companies, refineries, and intermediaries accused of participating in the purchase and transportation of Iranian oil.
The current sanctions campaign against Iran could turn into a new phase of US-China economic confrontation. This would mark a continuation of a long-standing history between Washington and Beijing, with nearly every US president trying to find an effective mechanism for exerting economic pressure on China.