What if the US sanctions Chinese banks over Iran's oil?
Secondary sanctions on Chinese banks clearing teapot-refiner payments choke Iran's ~1.5mbpd export lifeline; Brent leads on the Gulf premium while the China-clearing angle also drags tech/Nasdaq on trade-war read-through. Rhymes with the 2018 Iran re-sanctioning, which removed barrels but was offset by waivers. China is Iran's near-sole crude buyer and the chokepoint is the banking channel, not the oil; Beijing can reroute via smaller non-dollar banks. Forward angle: the Nasdaq leg looks overweighted — this is an oil/clearing shock, not a broad tariff event.
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The butterfly cascade
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What it would mean
If this plays out, it is a risk-off shock. US imposes secondary sanctions on Chinese banks clearing teapot refiners' Iran oil payments, severing Tehran's primary export lifeline. The trigger decomposes into signed root‑shocks — Geopolitical risk ▲ · Oil supply risk ▲ · Dollar/reserve confidence ▼ — which propagate through our causal graph to the markets below.