China’s Permanent Representative to the UN Fu Cong stated that talks between Trump and Xi will most likely be largely focused on the Strait of Hormuz. According to him, the key task now is to restore normal shipping as quickly as possible.
He said this as China took over the presidency of the UN Security Council in May. According to him, the Middle East remains the most tense hotspot, and the main focus is shifting there.
Speaking about the situation around Iran, Fu Cong noted that the main thing now is to maintain the ceasefire. Without direct negotiations between the parties, he believes, it will not last long.
He also added that by the time of Trump’s visit, the situation with the strait is unlikely to change, and it will most likely remain closed. Because of this, the topic of Hormuz will almost certainly be at the center of the negotiations.
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The White House confirmed that the trip to China is scheduled for May 14–15, if the situation does not change. This will be Trump’s first visit there in eight years. The meeting was originally planned for earlier, but it was postponed due to the conflict around Iran.
At the same time, it is unrealistic to expect that one trip will resolve all issues between Washington and Beijing. What matters now is whether the parties can at least prevent the situation from spiraling out of control.
Energy Blow to the Economy
The closure of the Strait of Hormuz has already dealt a significant blow to the global economy. Normally, about 20% of all oil and gas passes through it. At the peak of the crisis, about 13 million barrels of oil per day were lost from the market. Markets quickly began to draw down reserves, and prices immediately rose.
According to the World Bank, in 2026 energy could become about 24% more expensive. The situation with fertilizers is even more tense, with growth expected at around 31%. This further fuels inflation and puts more pressure on the economy, especially in developing countries.
Against this backdrop, buyers began to look for alternative routes, and some demand shifted toward China. In March 2026, Chinese energy sales reached $26 billion, already more than half the volume for the entire previous year.
At the same time, trade relations between the US and China continue to deteriorate. Over the past year, tariffs on a number of goods have risen to 145%. Total trade volume has decreased by about 30%, and Chinese exports to the US have dropped by $130 billion.
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China partially offset losses simply by redirecting flows. About $55 billion went to Europe and markets in Asia, the Middle East, and Africa.
The confrontation is increasingly shifting to the technology sector. According to a CSIS survey from March 2026, more than half of companies in the chip and technology sector wait more than 180 days for export licenses.
About a third face delays of more than 300 days. More than half admitted that they are losing deals because of this. 62% have seen relationships with clients worsen, and 58% have lost some customers altogether, who have gone to competitors.
A similar picture is shown by a study from the China Power Project. Most American experts see no signs of stabilization in relations between the countries. Only a quarter believe the situation is improving, and almost no one believes the parties will strictly adhere to agreements.
Pressure Is Growing, and the Parties May Reach a Deal
Economist Daniel Lacalle believes that in the end, the pressure will force everyone to come to an agreement. On the MacroVoices podcast, he described the situation as a three-way standoff between the US, Iran and China.
Each side has its own logic. The US, in his opinion, expects to weather rising fuel prices through exports. In Iran, he believes, there is less concern for the consequences for the population. China is betting on its raw material reserves.
But this cannot last long. In his opinion, rising costs will eventually push everyone toward an agreement that will resolve both the trade conflict and the tensions around Iran.
If the strait opens, Lacalle expects the dollar to weaken — the index could fall to 96. Oil prices, he estimates, are already near their peak and will gradually decline, though they will not return to previous levels.
Gold has already rolled back by about 20% since the beginning of the year. Lacalle explains this by saying that traders began closing bets against the dollar as it started to strengthen amid the escalation in the region.
