Treasury Secretary Scott Bessent’s threat to unleash an “economic D-Day” against Iran risks setting the US on a collision course with China, its main trading partner.
They did not say who had launched the projectile. Earlier reporting noted: A projectile struck a tanker west of the Saudi port city of Yanbu in the Red Sea on Monday, causing a fire on the main deck, shipping monitors from the United Kingdom Maritime Trade Operations said. China’s foreign ministry said on Monday that sanctions and pressure tactics do not help resolve issues and that Beijing would do what was necessary to protect the country’s interests.
The resulting oil and gas shock has driven up transportation, fertilizer and other input costs, fueled global inflation and squeezed consumers and businesses around the world. Higher freight and insurance costs have put additional pressure on global supply chains.
If the US were to hit China meaningfully – say, by targeting a Chinese bank – Beijing would view it “not only as destabilizing and as insulting, but also as a breach of” the trade truce previously agreed by Trump and Xi, said Michael Sobolik, a senior fellow at Hudson Institute. That could spur China to retaliate in ways that could hit the US hard, including with further export restrictions on critical minerals crucial to global manufacturing or limiting crucial pharmaceutical exports to the US, he said. Earlier reporting noted: Iran dismissed the US threat, vowing to shut down all oil exports from the Gulf “if the economic war continues” and issued a new warning to shipping not to pass through the Strait of Hormuz without its permission. Iran’s Houthi allies last month said they would block Saudi oil exports diverted to the Red Sea to avoid Hormuz.
Earlier reporting noted: Bessent previously urged China to cooperate with the US, noting China historically has received half of its oil imports from the Gulf region.
