China and the United States held a two-day round of trade talks in Stockholm on July 28-29 and reached agreement on most issues, including tariffs on technology and critical minerals. However, China flatly refused to budge on oil purchases from Russia and Iran, despite the US threat to impose 100% tariffs.
The Associated Press writes about this.
Thus, although the parties have made progress on the trade agreement, differences over oil imports remain fundamental.
Chinaʼs Foreign Ministry, in response to the US threat to impose 100% tariffs, stated that "the country will always ensure its energy security in a manner that meets national interests". The statement also emphasized that "coercion and pressure will not lead to anything".
This tough rhetoric comes amid general optimism between Beijing and Washington about a possible trade deal. At the same time, it demonstrates that China is prepared to take a tough stance when it comes to the nexus of trade with energy and foreign policy, especially in its dialogue with the Trump administration.
On July 31, the US Treasury Secretary Scott Bessent called the Chinese “tough” negotiators, but noted that their resistance had not stopped the negotiation process.
“I believe we have all the prerequisites for a deal,” he said on CNBC.
The US is seeking to limit oil sales from Russia and Iran, as they are major sources of revenue for both countries. According to the EIA, in 2024, about 80-90% of Iranian oil exports went to China. China imports more than 1 million barrels of oil from Iran every day, which significantly supports its economy.
When Iran threatened to close the Strait of Hormuz in June in response to US strikes on nuclear facilities, China opposed the closure of this critical oil route, demonstrating its strategic interest in the stability of supplies.
China is also a significant buyer of Russian oil, although it lags behind India in terms of seaborne shipments. In April, Chinese imports of Russian oil rose 20% to more than 1.3 million barrels per day, according to the KSE Institute.
- On July 30, after two days of talks in Stockholm, US Treasury Secretary Scott Bessent warned Chinese officials that if Beijing continued to buy Russian oil under sanctions, it would face heavy tariffs. China responded by saying it would defend its energy sovereignty.
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