Buyers of Iranian oil who do business with the U.S. are in trouble if President Trump follows through on a recent Truth Social post: “ALERT: All purchases of Iranian Oil, or Petrochemical products, must stop, NOW! Any Country or person who buys ANY AMOUNT of OIL or PETROCHEMICALS from Iran will be subject to, immediately, Secondary Sanctions. They will not be allowed to do business with the United States of America in any way, shape, or form” (May 1, 2025).
The Wall Street Journal observes that China is “the biggest remaining buyer of Iranian oil and refined products” (“Trump’s New Sanctions Threat Looks Past Iran to Target China,” May 2, 2025).
China and the U.S. remain locked in a broader battle over trade. The Trump administration has slapped heavy tariffs on Chinese goods but is weighing steps to ratchet down the tension, The Wall Street Journal has reported. It wasn’t clear how aggressively the new warning would be applied.
Trump’s threat on sanctions was one of several tough messages from the administration to Iran on Thursday, with Secretary of State Marco Rubio saying Iran had to stop enriching uranium and Defense Secretary Pete Hegseth warning Iran would pay a price for its support of Yemen’s Houthi militia, which has been firing drones and missiles at ships transiting the Red Sea.
The president had already kicked up pressure on Iran’s oil exports in February with a raft of sanctions against brokers, shippers and buyers….
China has become Iran’s external economic lifeline.
The United States and Iran have been engaging in pointless talks about the possibility of removing U.S. sanctions from Iran if the country stops enriching uranium. Maybe the U.S. side is close to throwing in the towel. Maybe it won’t be emulating the turpitudinous Obama-Biden approach of sending pallets of cash to theocratic sponsors of terrorism and hoping for the best.
In any way, shape, or form
No business with the United States “in any way, shape, or form” means no exemptions. Not for iPhones, not for microchips, not for anything. It doesn’t mean that Chinese imports will continue but be charged hefty 145% or 245% tariffs. In addition to ending other kinds of business transactions, it means ending imports from the offending country. Ending altogether. If we’re going by the words.
Xi Jinping, the PRC dictator, will or won’t say “Oh, okay, no more Iranian oil” and shut down the flow.
My first guess is that the Chinese government would not submit to such a demand. But the Journal notes that “China has been reducing trade with Iran following a string of aggressive actions by Washington.” The Trump administration’s actions have included prohibiting “two independent refiners and three terminal operations in China from using the American financial system or trading with the U.S. for buying Iranian oil. In response, the sanctioned plants and oil terminals stopped loading oil from Tehran, stranding at least 36 Iranian crude tankers in Chinese waters, according to Kpler.”
Suppose though that China continues to buy Iranian oil. The Trump administration will then try to make good on Trump’s threat or it won’t. If it acts to follow through, it will either be able to act or be partly or wholly blocked by Congress or courts.
No more de minimis
Meanwhile, the de minimis exemption from tariffs for packages from China valued at less than $800, prolifically used to avoid the tariffs on Chinese goods that Trump imposed during his first administration, has just ended.
Except that…
But the administration has also just waived a customs rule “ ‘requiring Formal Entry for goods valued between $250 and $2500 that are subject to ‘penalty’ tariffs,’ ” and this “ ‘will make it extremely difficult to collect tariffs on the millions of daily e-commerce shipments from China,” trade watchers at the American Economic Liberties Project warned Wednesday.”
Not only sub-$800 shipments will be affected by the waiver, which is doubtless motivated by the specter of insuperable logistical problems if both the tariffs and the customs rule are in place.
