• U.S.-China trade talks show signs of progress, but a standoff over Russian and Iranian oil persists.
• Trump threatens 100% tariffs while Beijing defends its right to maintain energy security on its terms.
• Congress weighs steep sanctions as bipartisan pressure mounts to block Russia’s oil revenues.

WASHINGTON, D.C. (TDR) — As President Trump presses for a sweeping trade deal with China, a key sticking point threatens to derail even the most optimistic negotiations: oil. Washington is demanding that Beijing cut off purchases from Russia and Iran—two of America’s top adversaries—but Chinese officials have made it clear that energy policy is not up for discussion.

“China will always ensure its energy supply in ways that serve our national interests,” Beijing’s Foreign Ministry posted on X Wednesday, following two days of talks in Stockholm.

U.S. Treasury Secretary Scott Bessent acknowledged that the Chinese are “tough” negotiators and made no promises to change their behavior, though he maintained confidence in striking a broader deal. “They take their sovereignty seriously,” Bessent told CNBC, adding, “They would rather pay a 100% tariff than give up Russian oil.”

Chinese Resistance

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Beijing’s response suggests a calculated readiness to absorb economic pain in exchange for geopolitical leverage. When President Trump unveiled a global tariff regime earlier this year, China was the only nation that responded in kind. Now, it is signaling once again that it won’t be bullied into energy concessions.

“If the U.S. is bent on imposing tariffs, China will fight to the end,” said Tu Xinquan of the China Institute for WTO Studies.

Experts say the stalemate reflects deep distrust. U.S. analysts argue that China views Trump’s demands as inconsistent and possibly temporary—more bargaining chip than national priority. Danny Russel of the Asia Society called China “the one holding the cards,” noting that Trump’s desperation for a big headline deal with President Xi could blunt enforcement.

“Beijing simply can’t afford to walk away from the oil from Russia and Iran,” Russel said. “It’s too important.”

Strategic Supply, Fire-Sale Prices

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China’s energy calculus is grounded in hard numbers. The U.S. Energy Information Administration reports that up to 90% of Iran’s oil exports—over 1 million barrels a day—go to China. In April, Beijing’s imports of Russian oil surged to 1.3 million barrels daily.

And with the Strait of Hormuz facing threats of closure from Tehran, China remains deeply invested in safeguarding its access to these oil flows.

India, too, is in Washington’s crosshairs. Trump recently slapped a 25% tariff on Indian goods and signaled more penalties may follow if New Delhi doesn’t reduce its reliance on Russian crude. But India has refused to budge, calling its partnership with Moscow “time-tested.”

White House adviser Stephen Miller added fuel to the fire by calling out India on Fox News:

“People will be shocked to learn that India is basically tied with China in purchasing Russian oil.”

Congressional Pressure Mounts

Back in Washington, Capitol Hill is readying its own strike. Sen. Lindsey Graham (R-S.C.) has introduced a bill that would authorize tariffs as high as 500% on countries that knowingly fund Russia’s war machine via oil, gas, or uranium purchases.

“The purpose of this legislation is to break the cycle,” Graham said, accusing China of bankrolling Russia’s invasion of Ukraine through sweetheart energy deals.

The bill already boasts 84 Senate co-sponsors and a bipartisan House counterpart. Though temporarily on hold, Republicans say they are poised to act if President Trump gives the green light.

Still, skepticism remains about whether such tariffs will be enacted or enforced. Analysts like Gabriel Wildau of Teneo warn that a full-scale trade war could unravel recent diplomatic progress.

“Realizing those threats would derail all the recent progress and probably kill any chance for a deal,” Wildau said.

Will Trump’s hardline oil ultimatum break the Russo-China axis—or break the global trade order instead?

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