The United States has intensified efforts to expand sanctions on Iran, aiming to impose what it describes as “economic asphyxiation” on Tehran amid the ongoing Middle East conflict. However, analysts suggest that successfully restricting Iran’s economic activities would require cooperation from China, a key trading partner of the Islamic republic, a scenario deemed unlikely in the current geopolitical climate.

Nearly six months into the conflict, Washington unveiled plans to broaden its sanctions regime against Iran, warning that countries continuing to support Tehran risked becoming international pariahs. The US has already targeted certain Chinese entities believed to be assisting Iran, with Treasury Secretary Scott Bessent urging Beijing to align with US policies against Tehran. In response, Chinese officials have defended their ongoing cooperation with Iran and reiterated their commitment to protecting national interests.

China plays a significant role in Iran’s economy, particularly as a major purchaser of Iranian oil. Tehran’s ability to circumvent sanctions has long relied on complex financial networks, including transactions conducted in China’s currency, the renminbi, which can operate beyond the reach of US sanctions. Political scientist Dylan Loh of Singapore’s Nanyang Technological University emphasized that effectively choking off Iran’s economy would require Beijing’s cooperation given these economic dependencies.

Before the outbreak of hostilities, Iran exported several million barrels of oil daily, with China as the primary buyer. Although current trade volumes have reduced, they remain an important source of revenue for Tehran. Nino Lezhava, a fellow at the Washington-based Center for European Policy Analysis, highlighted oil as a central economic lever for Iran. Despite blockades in the Strait of Hormuz, alternative transport routes through Central Asia provide China access to Iranian crude, according to Sun Degang, a political science professor at Shanghai’s Fudan University. Sun noted that ongoing commercial channels and alternative payment systems significantly undermine the effectiveness of economic isolation.

The US recognizes these challenges and has indicated a willingness to impose sanctions on Chinese banks that facilitate trade with Iran. Bessent stated that no entity is exempt from US sanctions, signaling potential measures against financial institutions involved in Iranian transactions. Nevertheless, Washington has so far refrained from targeting major Chinese banks, focusing instead on smaller entities accused of aiding Tehran’s acquisition of sensitive technologies.

Sun Degang cautioned that continuing to impose sanctions on Chinese companies could further alienate Beijing, reducing the likelihood of Chinese cooperation with US efforts. As tensions between the US and China escalate, particularly with a planned visit by President Xi Jinping to Washington in September, the impasse over Iran sanctions could add an additional layer of strain to the bilateral relationship.