President Donald Trump is now expanding his pressure campaign against Iran by threatening “tremendous economic consequences” on any country giving “any type of lifeline” to the nation. As the U.S. seeks to end the war, there is one potential target that stands alone to make a difference: China.
Former officials and analysts say it is likely the White House will attempt to squeeze Iran financially with additional secondary sanctions or penalties on Chinese entities that do business with Tehran.
The Treasury Department is scheduled to unveil the specifics of its plans to ramp up pressure on Iran on Monday. Secretary Scott Bessent, speaking to CNBC’s “Squawk Box” on Thursday, said the fresh measures would “squash” Iran’s ability to fund their military, and asserted that the U.S. is urging allies to choose a side in the war.
“If you insist on doing business with them, either transferring money, buying their oil, they are doing seaborne ship transfers, then the U.S. Treasury and the U.S. government, they will put its full might and force toward enforcing against you,” Bessent said. “We are going to have the toughest sanctions in history.”
He declined to say specifically whether the announcement would target China, arguing he prefers to keep certain discussions private. Still, Bessent warned Beijing: “It would do them a big service to get with the program.”
Given China’s economic ties to Iran, a new effort to put pressure on Beijing could reinvigorate a diplomatic push to end the war. Chinese diplomats have attempted to cool the temperature between Washington and Tehran before, contributing to an effort to broker a temporary ceasefire back in April.
China is by far Iran’s biggest purchaser of oil, accounting for some 90% of its exports. The consequences could be steep for the global economy if American officials choose to go after industries in China on a large scale or on a blanket basis.
Richard Nephew, a former deputy special envoy for Iran in the Biden administration, says economic risks could mount if the administration imposes sanctions on major banks that work with independent Chinese refiners or have ties to their intermediaries.
“It certainly could be disruptive to the global economy, depending on how big it is and how far it goes, that’s for sure,” said Nephew. It could also strain ongoing trade talks between the U.S. and China ahead of President Xi Jinping’s expected visit to Washington in September.
Gregory Brew, a senior Iran and oil analyst at the Eurasia Group, predicted that the Iranian regime would refuse to capitulate to the U.S., no matter the scope of the economic pressure campaign.
“Even if the US managed to get all of Iran’s trading partners (including China, its largest trading partner and sole oil customer) to join a new maximum pressure campaign, the regime would choose continued resistance over capitulation,” Brew told MS NOW. “My guess is they stick to attritional tactics, bunker down and absorb the pressure, in the belief that Trump will blink first.”
China’s largest state-owned oil refiner has already faced effects due to the Iran war. Sinopec reported a decrease in its crude throughput in the first quarter of 2026, down 0.2% compared to a year earlier. The company says it does not purchase its oil from Iran but regularly buys from other countries in the Middle East, though it has recently stepped up Russian oil imports to offset supply cuts.
The Treasury Department has sanctioned at least four Chinese independent oil refiners that buy from Iran since April 2025, as well as several financial companies that served as intermediaries for oil-related transactions. Trump, however, has not yet taken steps to penalize China’s oil and finance industry broadly.
“Sanctions and pressure will not solve the problem,” Chinese Foreign Ministry spokesperson Lin Jian said in a press briefing this week. “China calls on all parties concerned to take responsible measures to resolve the issue through political and diplomatic means.”
Iran relies on China substantially more economically than vice versa. Beijing can fall back on other oil sources, chiefly Russia and Saudi Arabia, given that only 12% of their supply was purchased from Tehran in 2025, according to a federal review commission.
Some experts argue that the U.S. economic pressure campaign will only work if it cuts off trade from other countries in addition to China. A senior Middle East official said past embargoes have failed because they did not cut off all trade with Iran by land and by sea.
“If you close one artery and another one opens up, you’re not really applying pressure,” the official said.
The United Arab Emirates — Iran’s second-largest trading partner just behind China — announced Wednesday that it would halt all trade and financial transactions with the country after Tehran fired two ballistic missiles targeting the UAE. It marked a major blow to Iran’s economy, given the UAE remains one of their biggest commercial partners.
Trump spoke with UAE President Sheikh Mohamed bin Zayed Al Nahyan on Tuesday about the “latest developments in the Middle East,” though it is unclear whether the U.S. played a role in their decision to halt trade with Iran.
Other countries that border Iran maintain trade relations with the country to varying degrees. In order to cut off every economic leverage, Nephew asked, “Is the president going to be comfortable imposing sanctions on” institutions in Qatar, Pakistan and Turkey? “Unless he’s willing to do that, this could be a lot of bark and no bite.”
Over the course of the war, the president has veered from threatening military attacks to talk of diplomatic breakthroughs. Vice President JD Vance told a radio program on Wednesday that the war is in a “new phase where the most effective tool that we have is the economic pressure.”
“We have things that we could sanction,” Trump told reporters Wednesday at the White House, though he did not specify what countries or entities could be the subjects. “We have very draconian sanctions, and we’ll see what happens.”
Previous efforts by the U.S. to cripple Iran’s economy have not changed Tehran’s behavior. Iran continues to execute a plan to charge ships passing through the Strait of Hormuz, and attack vessels that do not comply with its orders. Those moves have vexed allies and roiled markets for months, putting a strain on critical global supply chains.
“We’ve essentially added an arrow in the quiver for them,” said Grant Rumley, a senior fellow at the Washington Institute for Near East Policy who worked in the Defense Department during Trump’s first term, speaking about Iran’s control over the waterway. “The Iranians took the best punch the U.S. and Israel seemingly could throw at them, and they’re still standing.”
“All they have to do is outlast President Trump and the U.S., and they will come out of this in a better standing,” Rumley continued.
The White House has pursued an effort to squeeze Iran financially since April under the moniker Operation Economic Fury, led by Bessent’s agency. The secretary conceded that the administration does not know when the war will end.
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