How China's secret meeting with Iran could trigger 'Economic D-Day' and shock the global oil market
China hosted Iran’s deputy foreign minister for talks last week related to the US-Iran war, Beijing announced Sunday, disclosing the previously unreported meeting one day before Washington is expected to unveil “the toughest sanctions in history” against Tehran.
China's secret meeting with Iran's deputy foreign minister, Ali Bagheri Kani, took place last week, with Beijing only announcing it on Sunday. The meeting comes as the US prepares to unveil its toughest sanctions yet against Tehran, expected to be announced on Monday. The sanctions are rumored to target Iran's oil exports, which could significantly impact the global oil market. China is Iran's largest oil customer, purchasing over 700,000 barrels per day.
The potential sanctions and resulting oil market shock could lead to a significant increase in gas prices for American consumers. With the US already experiencing high inflation, this could further exacerbate the cost of living crisis. The average American household could see their gas bills rise by up to 20% if the sanctions lead to a substantial increase in global oil prices.
This development is part of a larger pattern of China-Iran cooperation, with the two countries signing a 25-year strategic partnership in 2021. China has also been investing heavily in Iran's energy sector, with state-owned companies like CNPC and Sinopec involved in major oil and gas projects. This cooperation has been seen as a challenge to US influence in the region and has contributed to rising tensions between Washington and Beijing.
The US is expected to announce its sanctions against Iran on Monday, which could trigger a response from Tehran. Iran has threatened to retaliate against US allies in the region if the sanctions are implemented. One surprising detail is that China has been quietly stockpiling Iranian oil in recent months, potentially allowing it to maintain its imports even if the US sanctions are imposed.
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