U.S. Secretary of State Pompeo announced Tuesday that “all Iranian oil buyers will stop importing from May 3, otherwise they will be subject to U.S. sanctions”. The market was frightened by media warnings ahead of time, and global oil prices surged more than 3% on Monday, reaching their highest level in nearly six months. The U.S. government has imposed 25 rounds of sanctions against Iran over the past two years, targeting nearly 1,000 individuals and entities. “Trump has become the biggest influencing factor in the global oil market,” Lin Boqiang, Dean of China Energy Policy Research Institute of Xiamen University, told the Global Times on the 22nd that if the United States really tries to reduce Iranian oil exports to zero, the blow to the Iranian economy can be described as “catastrophic”. Earlier, Iranian President Ruhani and military generals had threatened to block the Strait of Hormuz if Iran could not sell oil. Geng Shuang, spokesman for China’s Foreign Ministry, said at a regular press conference on the matter on the 22nd that China has consistently opposed the implementation of unilateral sanctions and so-called “long arm jurisdiction” by the United States. China’s cooperation with Iran is open, transparent, reasonable and legitimate, and should be respected. The Chinese government is committed to safeguarding the legitimate rights and interests of its enterprises and is willing to play an active and constructive role in promoting the stability of the international energy market.

On the morning of the 22nd, the White House said in a statement that Trump had decided not to reissue the exemption clause when it expired in early May. “The Trump Administration and our allies are determined to maintain and expand the greatest economic pressure on Iran in order to put an end to the political authority threatening the United States, our partners and allies and destabilizing activities in the Middle East.” The news immediately raised concerns about the oil market, with crude oil futures up 3.2% to $74.30 a barrel.

Later, at a news conference, Pompeo said that the goal of the United States is to achieve “zero export” of Iranian oil. How long this zero export policy will last depends entirely on Iranian leaders.

U.S. President Trump then tweeted that Saudi Arabia and other OPEC members would “make up” for the lack of oil supply caused by sanctions against Iran. Saudi Arabia’s energy minister also said on Monday that the country would coordinate with oil producers to ensure adequate supply for consumers and unbalanced global oil markets.

The Trump administration resumed sanctions against Iran after withdrawing from the Iranian nuclear agreement signed in 2015 last May. Last November, the United States granted six-month exemptions to eight economies (China, India, Japan, South Korea, Turkey, Italy, Greece and Taiwan, China) for importing Iranian oil, allowing them to find alternative channels for importing oil. Since November last year, Italy, Greece and Taiwan, China, have completely stopped importing oil from Iran, but five other economies have continued to import oil, while calling on the United States to extend exemptions. It is unclear whether these economies will be subject to U.S. sanctions if they do not immediately stop importing oil from Iran on May 3, or whether some of them will be given a buffer period to gradually reduce imports.

According to the Financial Times, this is only the latest step by the United States to increase pressure on Iran. Earlier this month, for the first time, the United States formally identified the Iranian Islamic Revolutionary Guard as a “terrorist organization”. Iran announced on the 21st that Salami will succeed Jafari as commander of Iran’s Islamic Revolutionary Guard, wondering whether it is related to the U.S. sanctions.