Washington DC - President Donald Trump on Thursday hinted that his administration may start sanctioning Chinese banks over their links to Iran, a move that would dramatically escalate the US' attempts to isolate Tehran.

Treasury Secretary Scott Bessent last week said the US is beginning to step up its campaign to "collapse" the Iranian government through economic sanctions and a variety of other measures.

In particular, Bessent suggested the US may impose a vastly expanded campaign of secondary sanctions on countries that continue to do business with Iran.

As Tehran's biggest trading partner, China was particularly angered by these comments, demanding Washington take a step back and implement "responsible measures" to end its war.

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A threat of sanctions against Chinese banks could have a profound impact on China's economy, as they handle payments between Tehran and Beijing and are crucial for the importing of Iranian oil.

During an event in the Oval Office on Thursday, Trump was asked by reporters whether he would sanction Chinese banks over such transactions. Trump responded with a cryptic question of his own.

"Who said I'm not?" he asked, hinting that Washington may already have the idea on its mind. "I mean, who said I'm not? You don't know if I'm doing it. Well, I don't have to announce everything, do I?"

As of writing, the Treasury has not issued any sanctions against major Chinese banks. It has, however, sanctioned numerous companies in mainland China and Hong Kong that it accuses of aiding the Iranian government and armed forces.

China has opposed US secondary sanctions related to Iran as "illegal."