Trump Says Xi Backs Strait Of Hormuz Opening While Beijing Says War Has No Reason to Continue
Synopsis
Following a two-day summit in Beijing, President Donald Trump claimed Chinese leader Xi Jinping agreed that Iran must reopen the blocked Strait of Hormuz. However, Beijing offered no concrete commitment to intervene, choosing instead to criticize the war as a conflict that "should never have happened." As diplomatic channels stall, oil prices surged 3% to $109 a barrel, and Tehran announced plans to charge transit fees to commercial ships cooperating with its new maritime routing mechanism.
US President Donald Trump said that Chinese President Xi Jinping agrees with Iran's decision to lift the Strait of Hormuz blockade. Beijing also denounced the way the war began but did not confirm the claim.
Key Highlights
- Trump said Xi had agreed the strait should be opened, but China gave no indication it would act.
- China retaliated by saying the war should never have started and has no justification to carry on.
- Iran intends to establish a shipping route in order to raise particular service fees from commercial vessels that participate.
- A lack of any diplomatic movement to end the war pushed global oil prices substantially higher, up 3% to $109 a barrel.
- This would involve Trump deciding on whether to roll back U.S. energy sanctions on Chinese oil firms to help push the talks forward.
Unproven Accusations And A Paused Agreement For Talks
Donald Trump talks to reporters on a plane back from a 2-day summit with his Chinese President Xi Jinping in Beijing. He said Xi agreed with him on both Iran not having nuclear weapons and the opening of the strait of Hormuz. The shipping lane was closed down by U.S. and Israeli air strikes, triggering the biggest oil supply crisis ever seen in our history.
And although Trump publicly claimed the Chinese would exert pressure on Tehran, the government in China was mute as to whether or not it would apply that same pressure, creating a massive divide between Beijing and Washington at a time when their leaders had just finished high-profile meetings.
Tariffs, Sanctions, and Tehran’s New Killing Road
The diplomatic standoff is largely being carried out in the form of backchannel messages and extreme economic pressure, with Trump currently at an inflection point regarding lifting U.S. sanctions on Chinese oil companies, the largest buyers of Iranian oil, for leverage. In an effort to counter America’s continuing port blockade of Iran, Ebrahim Azizi, the security chief of the Parliament of Iran, announced Saturday that Tehran is establishing a scheduled maritime corridor through which traffic must be directed while special fees will be collected from vessels willing to comply.
Iranian Foreign Minister Abbas Araqchi said that Tehran got notes showing Washington was ready for further negotiations and would not object to Chinese mediation.
Market Realities, Political Pressures and Professional Opinions
A total failure to make progress at the Beijing summit caused an immediate financial jinx, sending the global oil price 3% to $109 a barrel and sending the U.S. Treasury yields to a one-year high as inflation fears confirmed promises of U.S. Foreign policy experts also see a political liability for Trump as November congressional elections near and as both sides rejected proposals. Patricia Kim, from Brookings Institution, pointed out that China has so far offered no concrete promises to assist the U.S. with Iran, although other analysts say Beijing is using this crisis to shift to America.
FAQS
- How did China get to engage in pressing Iran to open up the Strait of Hormuz for the U.S.?
Trump says that Xi acknowledged the trade route had to be established, however, China does not allow such statements and only followed up by blaming the war’s origins.
- What is the new method of maritime routing by Iran?
Iran is establishing a dedicated transit route that will impose specific service fees on compliant merchant vessels.
- Will the US remove energy sanctions against Chinese oil companies?
Trump said he is now weighing whether to lift sanctions on Chinese companies that purchase Iranian oil possibly as a bargaining chip.
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