Trump’s Hormuz blockade tests U.S. ties with China and India

The US blockade of the Strait of Hormuz not only puts pressure on Iran, but also increases the pressure on India and China, its two most important relations in Asia.

With nearly 98 percent of Iranian oil exports destined for China and a summit between President Donald Trump and Chinese leader Xi Jinping weeks away, Washington’s maximum pressure campaign against Iran risks destabilizing the fragile détente the administration has carefully cultivated with Beijing.

India, which has complex ties with the US, finds US policy increasingly at odds with its economic interests; The most obvious example of this is the energy shock currently sweeping through its economy.

Trump is scheduled to visit China in mid-May, and the administration has signaled in recent weeks that it wants bilateral relations to be stable enough to keep the high-stakes meeting on track.

“The Iran conflict, especially the blockade, could upend that effort,” said Wendy Cutler, vice president of the Asia Society Policy Institute and a former U.S. trade negotiator.

Signs of friction are already emerging. Beijing, which has largely kept its stance on Trump’s blockade restrained, appeared to harden its tone on Tuesday. Foreign Ministry spokesman Guo Jiakun condemned the move It is seen as “dangerous and irresponsible” and this will only “increase tensions.”

More than a month after the war began, Trump employed a familiar strategy by threatening to hit China with 50% tariffs if Beijing supplied weapons to Iran. Beijing backed down and Guo denied what he called “baseless smears and malicious links.”

“China will resolutely retaliate with countermeasures against any attempt by the United States to use arms sales as an excuse for additional tariffs,” Guo said.

Meanwhile, India faces a different kind of pressure. Its heavy dependence on imported energy leaves it increasingly exposed to the economic effects of conflict.

Earlier this month, India resumed purchasing oil and natural gas from Iran after a seven-year hiatus, ensuring the safe passage of its ships through the Tehran Strait under a temporary exemption from the US.

Indian Prime Minister Narendra Modi after a speech approximately 40 minute interview He said the two leaders, who met with Trump on Tuesday, reached an agreement. “useful exchange of views” on the Middle East conflict and said India “supports de-escalation and restoration of peace as soon as possible.”

Even if Washington makes special provisions for India, they are unlikely to meet all of New Delhi’s gas needs, said Arpit Chaturvedi, a South Asia geopolitical risk consultant at consultancy Teneo.

Chaturvedi said that as the US blockade continues, India will likely stop importing crude from Iran, otherwise “we will see a deterioration in the relationship between New Delhi and Washington.”

For now, “there is no incentive for India to further risk its relationship with Washington and reach a new agreement.” [it] It is close to the point of no return,” Chaturvedi added.

But the impact of the energy shock affects the two Asian economies differently.

China’s exposure to an energy shock remains more manageable than other major economies due to its massive oil stocks and diversified energy mix.

The size of the oil flow from Iran to China also shows how structurally sound Tehran’s oil trade remains. Maritime intelligence firm Windward estimates that about 157.7 million barrels of Iranian crude were at sea as of Tuesday, with about 98% of it destined for China.

China’s strategic and commercial oil stocks, combined with barrels in transit, Eurasia Group China Director Dan Wang said that this figure covers a portion well above the 120-day net imports. “If only Iranian barrels are lost, China could absorb the shock by turning to other sources and turning more to coal,” he added.

US Treasury Secretary Scott Bessent said on Tuesday that Chinaunreliable global partnerHe criticizes Beijing for stockpiling oil during the conflict rather than easing the global crisis.

By contrast, India does not have a comparable buffer. As the world’s third-largest oil importer, India’s net income accounts for 3.5 percent of GDP, leaving it among the economies most vulnerable to the blockade, said Sumedha Dasgupta, senior economist at the Economist Intelligence Unit.

New Delhi, whose oil supplies last less than 60 days, faces a much harder landing if flows in the Middle East are further disrupted.

The situation is particularly dire for liquefied petroleum gas, the primary cooking and heating fuel for homes and commercial establishments. Dasgupta said India does not have any meaningful strategic reserves of LPG and stocks held by refiners and distributors can only meet two to three weeks of demand if imports stop.

Almost all of India’s LPG imports came from the Middle East and 66% of demand last year.

Analysts say it is also unlikely that a harsh counter-move from Beijing and New Delhi could quickly sour ties with the United States.

Wang said the blockade, which is similar to “Liberation Day” tariffs, is not discriminatory and applies to all buyers of sanctioned Iranian crude oil, rather than excluding China. “Beijing will protest at the diplomatic level, but it is unlikely to overreact with major retaliation.”

Meanwhile, Chaturvedi said India will shift its energy imports away from Iran once Washington’s exemption ends and instead turn to Russia, the US, Australia and other suppliers.

“Modi is unlikely to cross the red lines drawn by Trump,” he added.

Yet any miscalculation or direct conflict at sea could lead to a rapid deterioration of diplomatic standing and risk jeopardizing the fragile stability of the détente between Washington and Beijing.

“The US interfering with a Chinese ship would probably turn into a major incident. [as] David Meale, head of Eurasia Group’s China practice, said China would be careful to stand up to the US in such a situation, leaving relations in a fundamentally different place than they are now.

On Tuesday, a US-sanctioned tanker bound for China sailed from the Strait of Hormuz to the Gulf of Oman after Trump’s naval blockade came into force.