China Slashes Iranian Oil Imports by 40% Amid US Sanctions, Says Treasury Secretary Bessent

U.S. Treasury Secretary Scott Bessent said Tuesday that China has reduced its crude oil purchases from Iran by approximately 40% in recent months, a move he said is directly pressuring Tehran's finances. The decline was attributed to U.S. sanctions targeting specific Chinese buyers.

Sanctions on 'Teapot' Refiners

In an interview with Fox Business Network, Bessent specified that the United States has imposed sanctions on Chinese "teapot" refineries. These are smaller, privately owned facilities that have been significant buyers of Iranian crude.

This pressure has led to a "substantial drop" in their oil imports from Iran, Bessent stated. He also noted that China's overall crude purchases have declined more broadly due to current price levels and the nation's large strategic petroleum reserve.

Market and Geopolitical Impact

The reduction in Chinese demand is "significantly reducing Iran's oil revenues," according to the Treasury Secretary. This development underscores the impact of U.S. secondary sanctions, which aim to curtail Iran's main source of income and exert economic pressure on its government.

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For energy markets, a sustained drop in purchases from one of Iran's most important customers could shift global crude oil flows. The effectiveness of these sanctions will be closely watched by investors assessing geopolitical risk in the Middle East.

Broader US-China Tensions

Separately, Bessent addressed another point of friction between Washington and Beijing, accusing Chinese artificial intelligence models of improperly using U.S. technology. "We are finding watermarks of our U.S. large language models on many of the Chinese models, and that's unacceptable," he told Fox Business.

Bessent added that the administration would examine the issue further "in the coming days or week," signaling continued scrutiny of China's technology sector.