• China threatens retaliation against US expansion of sanctions targeting Iranian trade.
• Chinese officials assert that any restrictions on Iran affect their economic interests.
• The US sanctions aim to isolate Iran and discourage other nations from doing business with it.
• Beijing continues to advocate for negotiations instead of unilateral sanctions.
• Market dynamics shift as China's oil imports from Iran face uncertainty under US pressure.

China has issued a stern warning regarding potential retaliatory measures against the United States if Washington expands its sanctions campaign against Iran to include Chinese companies. Following a recent announcement from US Treasury Secretary Scott Bessent, which aimed to further isolate Iran and its trading partners, including those in China, Beijing emphasized its commitment to defending its economic interests, according to BBC and India Times.

Foreign ministry spokesman Lin Jian reiterated that China firmly opposes what it characterizes as "illegal unilateral sanctions" imposed without the authorization of the UN Security Council. He stated, "Cooperation between China and Iran has always been conducted within the framework of international law and should not be interfered with or disrupted," highlighting China's stance on the matter, according to Al Jazeera and Middle East Eye.

The US's recent sanctions package includes penalties against a variety of individuals and entities linked to Iran, with recent reports suggesting the measures target businesses in both mainland China and Hong Kong. However, major Chinese banks involved in oil trade with Iran were notably excluded from these sanctions, as noted by sources including Middle East Eye and Al Jazeera.

China's response reflects significant economic stakes, as it is the largest buyer of Iranian oil, accounting for approximately 90% of Iran's exports. Smaller independent refiners in China, known as "teapot" refineries, continue to operate despite US sanctions, which may complicate Washington's efforts to restrict Iran's oil trade. The nuance of this trade relationship has prompted analysts to suggest that a broader enforcement of sanctions against Chinese entities may face considerable diplomatic hurdles if executed too aggressively, as stated in India Times and Middle East Eye.

As diplomatic tensions rise ahead of critical meetings between US President Donald Trump and Chinese President Xi Jinping, analysts speculate that Washington's pressure might merely be a strategic tactic rather than a prelude to sweeping sanctions. Experts warn that any severe move against Chinese companies could invoke strong resistance from Beijing, potentially resulting in retaliatory actions that complicate already delicate economic relations, according to BBC and Al Jazeera.