China warns it will take ‘all necessary measures’ against US sanctions threat over Iran oil trade

Beijing rejects secondary sanctions as illegal, stepping up defiance of Washington’s effort to isolate Tehran

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By LineZotpaper

Published25 August 2026

Read Time3 min

China has denounced the threat of US sanctions for its trade with Iran, calling any such measures illegal and warning it will take ‘all necessary measures’ to protect its national interests, as Washington intensifies its campaign to cut off revenue to the Tehran regime.

Beijing’s statement, reported by the Guardian, signals a sharp escalation in the ongoing standoff between the world’s two largest economies over Iran. China is the biggest buyer of Iranian oil, purchasing an estimated 80% of Iran’s crude exports, and has previously defied US efforts to limit the flow of revenue to Tehran.

The Trump administration has ramped up pressure on Iran through a renewed ‘maximum pressure’ strategy, which includes threatening secondary sanctions against any country or entity that continues to trade with the Islamic Republic. The latest move, announced on August 24, targets nations, companies, and financial institutions with significant economic ties to Iran.

China immediately pushed back. The foreign ministry in Beijing stated that the US threat violates international law and the principles of the United Nations Charter. “China will take all necessary measures to resolutely safeguard its legitimate and lawful rights and interests,” a spokesperson said, without specifying what those measures might be.

The confrontation highlights the limits of US unilateral sanctions when a major power like China is unwilling to comply. Despite US sanctions, China’s crude imports from Iran have continued, often through opaque trading networks and ‘ghost fleet’ tankers. Beijing views the US pressure as an infringement on its sovereignty and economic policy.

The US argues that cutting Iran’s oil revenue is essential to preventing Tehran from developing nuclear weapons and supporting proxy groups in the Middle East. Washington believes that secondary sanctions, which have been used effectively against North Korea and other regimes, will force Beijing to choose between lucrative trade with Iran and access to the US financial system.

So far, China has refused to bend. The two countries are already locked in a broader strategic rivalry over trade, technology, and influence in Asia. Analysts suggest that Trump’s tough stance on Iran could further strain US-China relations, with potential spillover effects on global oil prices and energy markets.

Iran, meanwhile, remains heavily dependent on Chinese purchases to prop up its economy amid severe international sanctions. Tehran has vowed to continue exporting oil, with or without US permission, and has deepened energy cooperation with Beijing in recent years.

The situation remains fluid. The exact scope of the new US sanctions has not been fully detailed, and it is unclear which Chinese companies or banks will be targeted. Beijing may retaliate with measures of its own, possibly targeting US companies in China or curbing exports of critical minerals.

Analysis

Why This Matters

Energy markets: China is Iran's largest oil customer. Any disruption in this trade could raise global oil prices, affecting consumers worldwide.
US-China relations: This dispute adds another layer of tension to an already strained bilateral relationship, with potential for tit-for-tat sanctions spiraling into broader economic conflict.
Sanctions regime credibility: If China successfully evades US secondary sanctions, it could undermine Washington's ability to enforce unilateral economic measures against other rivals.

Background

The US has used economic sanctions as a primary tool to pressure Iran since the 1979 revolution, but sanctions tightened dramatically under the Trump administration's 'maximum pressure' campaign from 2018-2020. Despite the Biden administration's initial shift toward diplomacy, the Trump team returned to a hardline posture after the 2024 election. China has consistently maintained that its trade with Iran is legal and has built alternative payment systems (such as CIPS) to bypass US-controlled financial channels. The US has previously sanctioned Chinese companies and banks for facilitating Iranian oil transactions, but Beijing has continued to buy crude through intermediaries and ship-to-ship transfers.

Key Perspectives

[United States]: Argues secondary sanctions are necessary to cut off Iran's funding for nuclear and militant activities. Washington believes economic isolation is the most effective lever short of military action. [China]: Views US extraterritorial sanctions as a violation of international law and its sovereignty. Beijing insists on the right to conduct normal trade with any UN member state. [Critics/Skeptics]: Some analysts question whether secondary sanctions can work against a major economy like China, which has deep financial reserves and alternative trade channels. Others warn that escalating pressure could push China and Iran into a more formal energy-military alliance.

What to Watch

US Treasury actions: Which specific Chinese banks or entities are designated? Targeting major state-owned banks would be a significant escalation.
China’s retaliatory measures: Could include reducing purchases of US agricultural goods, rare earth export controls, or blacklisting American firms.
Oil prices: A sharp price surge would signal markets believe trade disruptions are likely despite China's defiance.

Sources

China denounces US threat of sanctions over trade with Iran — World news | The Guardian