Yellen: U.S. will levy sanctions against Iran over attack on Israel

Among the most obvious remaining options is aggressively expanding sanctions on Chinese firms that have bought large quantities of Iranian crude oil exports, which have provided a financial lifeline for Tehran as it remains cut off from the West. The United States has over the past year imposed sanctions on some commercial links in the oil trade between China and Iran, but experts say the administration could go further by hitting many more Chinese refineries and banks with the restrictions.

Doing so carries its own risks, however. Yellen and other administration officials have tried stabilizing relations with China in recent months, and a sudden blow to energy production could infuriate Beijing. Additionally, cutting off sales of Iranian crude could cause oil prices to spike globally amid tighter supply, potentially leading to higher gas prices ahead of the 2024 presidential election.

“There are not a lot of options that are game changers, because so much of Iran is already sanctioned,” said Rachel Ziemba, adjunct senior fellow at the Center for a New American Security, a foreign policy think tank. “But if you really want to cut off oil revenue for Iran, you have to go through China and Chinese institutions.”

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