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The Trump administration's conflict with Iran has disrupted a major source of energy for China.
China has ordered its companies to disregard U.S. sanctions imposed on private refiners that trade Iranian oil.
China has previously demonstrated its economic leverage over the United States by restricting exports of rare earth minerals.
China's use of its control over critical minerals during the trade war successfully pressured the U.S. to enter negotiations and agree to a pause in hostilities.
Research by Bloomberg Economics analysts Nicole Gorton Caratelli and Chris Kennedy found that 4% of U.S. GDP, equivalent to $1.2 trillion, is implicated in the use of rare earth minerals.
According to Bloomberg Economics research, approximately 1.5% of the U.S. GDP implicated by rare earths cannot be substituted, as China is the sole source for those specific minerals.
The United States currently holds a lead over China in the development of powerful AI models, exemplified by products like Mythos from Anthropic.
China is dissatisfied with the U.S. blockade in the Strait of Hormuz because it impacts a major source of its energy imports.
China opposes recent U.S. sanctions that target its private oil refineries involved with Iran.
In the past, even Chinese state-run banks complied with U.S. sanctions to avoid being cut off from the U.S. dollar system.
Senator Marco Rubio has stated that U.S. sanctions are not symbolic and will be enforced.
China is actively collecting data from companies that import its critical minerals regarding their specific end-uses.