China is Iran’s largest oil buyer and biggest trading partner
Treasury Secretary Scott Bessent this week announced what he called an “economic onslaught” on Iran’s remaining financial connections around the world — a new pressure campaign targeting the Islamic Republic’s network of overseas partners. But absent from Bessent’s remarks were any specifics about how the Trump administration would approach the country that anchors Iran’s economy: China.
Beijing is Iran’s biggest trading partner and its leading oil buyer. The omission leaves uncertain how aggressively Washington is willing to confront Chinese entities that continue to transact with Tehran, even as President Donald Trump prepares to host Chinese leader Xi Jinping next month to maintain a fragile trade truce.
Edgard Kagan, a senior adviser and Freeman Chair in China studies at the Center for Strategic and International Studies, said Tuesday that the deliberate absence of China-specific language in Bessent’s announcement reflected the administration’s effort to avoid disrupting the planned state visit. Kagan previously served as U.S. ambassador to Malaysia from December 2023 until this past February.
“The announcement yesterday was very careful in my view to avoid specifics (against China), which could have led to a disruption in the summit,” Kagan said. “For Xi, a state visit to Washington is a big deal; and for Trump, hosting it is a big deal.”
The tension Kagan identified leaves the United States balancing two competing priorities. The Trump administration is seeking maximum economic pressure on Iran to isolate the Islamic Republic from its remaining economic partners. But sanctions or enforcement actions aimed at Chinese firms or oil purchases could escalate tensions with Beijing in ways that carry costs for the American economy.
That leaves both governments with diplomatic maneuvering to do ahead of the summit, Kagan said. The unresolved question, in his view, is whether China can be persuaded to reduce its economic activity with Iran without rejecting U.S. demands outright.
“I think the real question is, is there room to push (the Chinese) to reduce what they’re doing with Iran, to put more pressure on the Iranian regime in a way that doesn’t lead them to say, ‘This is unreasonable, and we’re not going to comply,’” Kagan said.
The campaign Bessent announced marks a new U.S. economic campaign against Iran, though Bessent’s remarks did not include specifics on how the administration would target Chinese economic ties to Tehran. Without clear action against China — Iran’s biggest trading partner and leading oil buyer — the announcement left uncertain how effectively the new effort can isolate Tehran from its remaining economic partners.