U.S. targets foreign partners keeping Iran trade alive

Traders Union
All News
Geopolitics & Trade
U.S. turns up pressure on Irans

Highlights

Washington is expanding pressure beyond Iranian entities to foreign partners.
China faces the greatest exposure because of its Iranian oil purchases.
Iraq and Turkey remain vulnerable through energy dependence.
The UAE has already moved to cut commercial ties with Tehran.

Under the initiative known as Operation Economic Outcast, Washington plans to give countries and companies deadlines to wind down activities it identifies as supporting Iran before secondary sanctions are applied, according to CNBC. The pressure extends beyond oil to shipping, banking, aviation, technology, gold, and digital assets, while the U.S. has already sanctioned dozens of Iran-linked entities, individuals, and vessels.

China poses the biggest test

China is by far the most consequential target. It accounts for roughly 90% of Iranian oil exports, according to U.S. estimates. Official bilateral trade reached $9.96 billion in 2025, excluding an estimated $31.2 billion of Iranian crude shipments that were not reflected in reported trade.

Much of that oil has gone to independent Chinese refiners, with transactions often routed through intermediaries and outside the dollar system. Washington has already sanctioned some China-based companies involved in Iranian commerce, but extending pressure to major Chinese financial institutions would carry much greater economic and diplomatic consequences.

Other countries face different vulnerabilities. The United Arab Emirates had about $28 billion in bilateral trade with Iran in 2024 but has since moved to halt trade and financial transactions with Tehran. Turkey recorded $5.7 billion in trade with Iran in 2024 and remains exposed through natural gas imports.

Iraq is particularly vulnerable because of its reliance on Iranian energy. Bilateral trade exceeded $10 billion in 2025, while Baghdad has historically paid roughly $4 billion to $5 billion annually for Iranian gas used in electricity generation. India, meanwhile, recorded about $1.6 billion in bilateral trade in the year ending March 2026 and recently resumed limited Iranian crude purchases.

Sanctions could reshape regional trade

The campaign matters because its effectiveness will depend less on additional restrictions inside Iran than on whether Washington can persuade or compel third countries to enforce them. The Treasury strategy explicitly targets the international networks Iran uses to earn oil revenue, transfer funds, and maintain access to global commerce.

China is the critical test. Aggressive enforcement against Chinese banks or refiners could weaken a major Iranian revenue channel, but it could also strain the fragile U.S.-China trade relationship. Iraq and Turkey face more immediate energy concerns, while the UAE has already reduced one of Iran's important routes into international finance.

The result could determine whether secondary sanctions materially isolate Tehran or instead accelerate the development of trade and payment channels designed to bypass Washington.

Earlier, we reported that the U.S. expands sanctions against Iran’s crypto sector over $100 million in oil payments.

This material may contain third-party opinions, none of the data and information on this webpage constitutes investment advice according to our Disclaimer. While we adhere to strict Editorial Integrity, this post may contain references to products from our partners.