Xi takes Trump on tour of Communist Party's seat of power as China visit ends

On May 13, 2026, U.S. President Donald Trump traveled to Beijing for crucial talks with Chinese President Xi Jinping, with the escalating tensions surrounding the Iran war and the Strait of Hormuz being a significant topic. Iran accused the U.S. and Israel of fabricating justifications for conflict, while Trump indicated the war would conclude one way or another. The summit occurs amidst heightened regional instability, including Kuwait's arrest of alleged IRGC members and Qatar's accusation of Iran weaponizing the Strait of Hormuz. Iran's chief negotiator presented a peace plan, while U.S. intelligence suggests Iran retains substantial missile capabilities and has restored access to numerous missile sites along the Strait of Hormuz. Trump is reportedly considering restarting naval escorts through the Strait of Hormuz.

Iran and the United States remain at an impasse regarding the end of their conflict, with a fragile ceasefire showing signs of collapse. Recent exchanges of fire, targeting of ships, and renewed fighting between Israel and Hezbollah threaten to escalate the situation back into open warfare and prolong the global energy crisis. U.S. President Trump plans to leverage his upcoming trip to China to urge President Xi Jinping to pressure Iran into concessions. The core disagreement centers on Iran's demand for the lifting of U.S. sanctions and port blockades before negotiating its enriched uranium stockpile, which the U.S. and Israel view as a proliferation risk. Iran maintains its nuclear program is peaceful, while the U.S. considers Iran's response to its latest proposal "unacceptable."

Iran has warned against complying with US sanctions amidst reports of attacks in the Gulf. On Sunday, Kuwait reported drones entering its airspace, and the UAE stated its air defenses intercepted two drones originating from Iran. These incidents follow US claims that Iran launched an "unprovoked attack" with missiles, drones, and boats against three US warships on Friday. Iran, however, alleged the US targeted an Iranian oil tanker and another vessel near the Strait of Hormuz, conducting aerial attacks on coastal areas. Both nations have established blockades in the Strait of Hormuz, a vital oil and gas transit route, as diplomatic efforts to end the conflict have stalled.

US President Donald Trump's visit to Beijing concluded with a tour of Zhongnanhai, the heavily guarded compound where top Chinese leaders reside and work, led by President Xi Jinping. This event, part of a two-day trip characterized by ceremony rather than detailed policy agreements, followed tensions over trade and the Iran war. Both leaders adopted a conciliatory tone, with Trump describing his visit as "incredible" and Xi calling it a "new bilateral relationship." The tour of Zhongnanhai, a rare honor for foreign dignitaries, underscored the significance of the meeting, with Xi noting that few other leaders, such as Russia's Vladimir Putin, have been granted such access.

President Donald Trump's upcoming trip to China is anticipated to be less grand than his 2017 visit due to ongoing trade tensions and Beijing's economic ties with Iran. While Trump has previously expressed admiration for Chinese President Xi Jinping, the current geopolitical climate, particularly concerning Iran, is expected to temper the reception. Unlike his first visit, which was a "state visit-plus" with extensive ceremonies and a private dinner at the Forbidden City, this trip will be shorter and less elaborate. The shift reflects a more complex relationship between the two nations, influenced by economic factors and international relations, even with Trump's personal respect for Xi.

US President Donald Trump will make a state visit to Beijing from May 13-15 at the invitation of President Xi Jinping. This marks the first presidential visit to China in nearly nine years and occurs amidst heightened bilateral tensions and global economic concerns, including the Strait of Hormuz blockade. The visit's agenda includes a welcome ceremony, bilateral meetings with President Xi, and visits to cultural sites. The US also plans a reciprocal visit for President Xi later this year. Prior to Trump's arrival, Vice-Premier He Lifeng will attend trade talks in South Korea with US Treasury Secretary Scott Bessent.

Oil prices surged in Asian trading Monday after U.S. President Donald Trump rejected Iran's proposal to end the ongoing conflict. Iran, through Pakistan as a mediator, had called for an immediate cessation of hostilities and guarantees against future U.S.-Israeli attacks. In response, Trump declared Iran's terms "totally unacceptable." This development comes as the Strait of Hormuz remains effectively closed since the war's commencement on February 28th, significantly impacting global oil and gas supplies. Brent crude rose 4.1% to $105.50 a barrel, and U.S. crude increased 4.4% to $99.80. The U.S. had previously demanded the restoration of free transit through the Strait and the suspension of Iran's nuclear enrichment.

Wall Street investors are adopting a new market narrative, "Nacho," which stands for "Not a chance Hormuz opens." This acronym reflects a growing expectation of continued geopolitical gridlock and elevated oil prices, particularly with the upcoming Trump-Xi meeting and ongoing tensions in the Strait of Hormuz. This shift represents a significant change from the previous year's dominant strategy, "Taco" ("Trump always chickens out"), which assumed President Trump would de-escalate trade disputes. The "Nacho" sentiment suggests a belief that current geopolitical challenges, including the fragile US-Iran ceasefire and the Strait of Hormuz blockade, will persist, influencing investment strategies.

The Pentagon has updated the cost of the US-Israel war with Iran to $29 billion, an increase from the previously reported $25 billion. Defense Secretary Pete Hegseth presented this figure to a congressional panel on May 12, 2026, attributing the rise to updated repair, replacement, and operational costs. While the Pentagon maintains preparedness for escalation or de-escalation, questions persist from experts and lawmakers regarding the accuracy of the cost estimate and the impact on US munitions stockpiles and the broader economy. The war, which began on February 28, has seen fighting largely paused since April 8.

President Donald Trump's upcoming visit to Beijing, delayed by six weeks, faces a potential point of friction with Chinese President Xi Jinping: the war in Iran and the closure of the Strait of Hormuz. While both nations desire the strait's reopening and an end to the conflict, their approaches differ significantly. The US, with its energy independence, may believe China is more susceptible to energy disruptions. Conversely, China might perceive prolonged instability as more detrimental to the US and its allies. This divergence in perspective on the Iran crisis could complicate discussions during the summit.

On day 65 of the conflict, Iran has presented the US with a 14-point proposal aimed at ending the war. The plan calls for nonaggression guarantees, sanctions relief, the lifting of a naval blockade, and an end to hostilities on all fronts, including Lebanon. President Trump stated he will review the proposal but expressed skepticism about a deal, citing escalated rhetoric. Despite this diplomatic overture, both sides have indicated readiness for renewed conflict, with the Islamic Revolutionary Guard Corps on standby. Iran's proposal seeks to resolve all issues within 30 days, differing from the US request for a two-month ceasefire. Meanwhile, an Iranian supertanker reportedly evaded the US blockade carrying millions of dollars worth of oil.

President Donald Trump is set to visit China for a summit with President Xi Jinping next week. This visit occurs amidst global energy supply disruptions and economic uncertainty caused by the Iran war, which have also strained US-China relations. Six months prior, when the summit was proposed, Trump was in a stronger political position than Xi. However, Trump now travels to Beijing facing political challenges and military overextension. Experts suggest these factors will influence the dynamics of the upcoming meeting between the two leaders.

The United Arab Emirates reported intercepting 15 missiles and four drones fired from Iran, marking the first UAE targeting since an April 8 ceasefire. One drone attack caused a fire at a Fujairah petroleum zone, injuring three Indian nationals, while an empty crude oil tanker was also attacked near the Strait of Hormuz. Iran has denied the accusations. Several countries, including Saudi Arabia, Qatar, Kuwait, Bahrain, and Jordan, condemned the attacks, denouncing them as a threat to regional security and a violation of UAE sovereignty. Germany, the UK, and Canada urged Iran to return to talks.

On day 64 of the conflict, US President Donald Trump rejected Iran's latest peace proposal, stating its demands were unacceptable and warning against premature resolution. The US also threatened sanctions on ships transiting the Strait of Hormuz that pay tolls to Iran. Domestically, a poll indicated 61% of Americans view the use of military force against Iran as a mistake. In Iran, fourteen soldiers died in an ordnance disposal incident, and Supreme Leader Mojtaba Khamenei called for economic resistance. The IRGC Navy announced new maritime rules near its coast. Meanwhile, the US imposed measures on entities involved in Iranian oil exports, which China condemned, while approving significant military sales to regional allies.

German Chancellor Friedrich Merz stated on Monday that the United States is being "humiliated" in its conflict with Iran, warning of a potential quagmire similar to Iraq and Afghanistan. Speaking to students in Marsberg, Merz argued that Iran is demonstrating superior negotiation skills and appears "clearly stronger than one thought." He expressed concern that the US lacks a clear exit strategy from the war, which he believes is impacting Germany's economy. Merz also indicated Germany's readiness to deploy minesweepers to secure the Strait of Hormuz, contingent on a ceasefire. The comments highlight growing European concerns about the conflict's economic and energy ramifications.

President Donald Trump has escalated his criticism of European allies, threatening to withdraw U.S. troops from Italy and Spain. This comes after Germany's Chancellor Friedrich Merz stated that the U.S. was being "humiliated" by Iran. Trump has also expressed dissatisfaction with NATO allies for not contributing naval forces to secure the Strait of Hormuz. Separately, a U.S. Senator questioned the Secretary of Defense regarding the accuracy of war assessments on Iran. In unrelated news, footage was released showing an individual attempting to breach security at a White House dinner event.