US President Donald Trump announced on Tuesday that China may proceed with Iranian oil purchases following the Israel-Iran ceasefire agreement, though the White House subsequently clarified this statement does not represent an easing of US sanctions.“China can now continue to purchase oil from Iran. Hopefully, they will be purchasing plenty from the US, also,” Trump posted on Truth Social, shortly after authorising US strikes on three Iranian nuclear facilities.A senior White House official explained to Reuters that Trump’s statement highlighted Iran’s decision not to block the Strait of Hormuz to oil vessels, as such a blockade would have significantly affected China, which is the largest buyer of Iranian oil.The official said, “The president continues to call on China and all countries to import our state-of-the-art oil rather than import Iranian oil in violation of US sanctions.”Oil prices dropped approximately 6% on Tuesday, influenced by Trump’s remarks regarding China following the ceasefire declaration.
US Sanctions On Iran
A potential easing of sanctions on Iran would indicate a departure from the previous stance, as Trump had announced in February his intention to maintain maximum pressure on Iran, targeting its oil exports due to concerns over its nuclear programme and regional militant support.Trump had previously implemented multiple sanctions affecting Chinese independent refineries and port operators due to their Iranian oil purchases.“President Trump’s greenlight for China to keep buying Iranian oil reflects a return to lax enforcement standards,” said Scott Modell, a former CIA officer, now CEO of Rapidan Energy Group, according to the Reuters report.Beyond non-enforcement, the president holds authority to suspend or waive sanctions through executive orders or congressional legislation.According to Modell, Trump is unlikely to waive sanctions before upcoming US-Iran nuclear negotiations, as these measures provide strategic advantage considering Tehran’s requirement for permanent sanctions relief.Jeremy Paner from Hughes Hubbard & Reed law firm indicated that a presidential decision to suspend Iran-related oil sanctions would necessitate substantial inter-agency coordination.The United States Treasury would require authorisation permits, whilst the State Department must provide waivers that necessitate notification to Congress.
China To Buy More US Oil?
Market specialists and oil analysts across Asia indicated that Trump’s statements were unlikely to influence China’s immediate procurement patterns for oil, whether from Iran or the United States.Iranian crude constitutes approximately 13.6% of China’s petroleum acquisitions this year, with the reduced-price supplies serving as crucial support for independent refineries operating under tight margins. American oil represents merely 2% of Chinese imports, and Beijing’s imposed 10% duties on US petroleum effectively discourage additional purchases.China consistently challenges what it terms Washington’s “abuse of illegal unilateral sanctions.”When questioned about Trump’s statement during a standard press conference, Chinese foreign ministry spokesperson Guo Jiakun stated that China would implement appropriate energy security measures aligned with its national interests.Increased Iranian oil acquisitions by China and other nations could potentially create tension with Saudi Arabia, the global leader in oil exports.The effectiveness of US sanctions on Iranian exports has remained restricted since the initial stringent measures implemented during Trump’s previous administration.This year, Trump has imposed sanctions on Chinese trading firms and terminals, yet the outcomes have been notably less impactful than intended, according to Modell’s assessment.In response to media queries, State Department spokesperson Tammy Bruce confirmed that Trump had indicated his objectives and the administration is committed to achieving them. She declined to elaborate on specific procedures.“But clearly we are focused on making sure that (the) guiding hand of President Trump prevails and moves this government forward, so we will have to wait and see when it comes to what that ends up looking like,” Bruce said.
