(Fixes typo in headline)

By Timothy Gardner

(Reuters) -President Donald Trump said on Tuesday that China can continue to purchase Iranian oil after Israel and Iran agreed to a ceasefire, a move that the White House clarified did not indicate a relaxation of U.S. sanctions.

"China can now continue to purchase Oil from Iran. Hopefully, they will be purchasing plenty from the U.S., also," Trump said in a post on Truth Social, just days after he ordered U.S. bombings of three Iranian nuclear sites.

Trump was drawing attention to no attempts by Iran so far to close the Strait of Hormuz to oil tankers, as a closure would have been hard for China, the world's top importer of Iranian oil, a senior White House official told Reuters.

"The president continues to call on China and all countries to import our state-of-the-art oil rather than import Iranian oil in violation of U.S. sanctions," the official said.

After the ceasefire announcement, Trump's comments on China were another bearish signal for oil prices, which fell nearly 6%.

Any relaxation of sanctions enforcement on Iran would mark a U.S. policy shift after Trump said in February he was re-imposing maximum pressure on Iran, aiming to drive its oil exports to zero, over its nuclear program and funding of militants across the Middle East.

Trump imposed waves of Iran-related sanctions on several of China's so-called independent "teapot" refineries and port terminal operators for purchases of Iranian oil.

"President Trump's greenlight for China to keep buying Iranian oil reflects a return to lax enforcement standards," said Scott Modell, a former CIA officer, now CEO of Rapidan Energy Group.

In addition to not enforcing sanctions, Trump could suspend or waive sanctions imposed by executive order or under authorities a president is granted in laws passed by Congress.

Trump will likely not waive sanctions ahead of coming rounds of U.S.-Iran nuclear talks, Modell said. The measures provide leverage given Tehran's demand that any deal includes lifting them permanently.

Jeremy Paner, a partner at Hughes Hubbard & Reed lawfirm, said if Trump chooses to suspend Iran oil-related sanctions, it would require lots of work between agencies.

The Treasury would need to issue licenses, and the State Department would have to issue waivers, which require Congressional notification.

'FLASHED THE GLOCK'

China has long opposed what it has called Washington's "abuse of illegal unilateral sanctions." China's embassy in Washington did not immediately respond to a request for comment about Trump's post.

Larger purchases of Iranian oil by China and other consumers could upset U.S. ally Saudi Arabia, the world's largest oil exporter.

The impact of U.S. sanctions on Iran's exports, however, has been limited since Trump's first administration when he cracked down harder on Tehran.

Trump has "flashed the Glock" this year with sanctions on Chinese trading companies and terminals, but the results have been far more "minimum pressure" than maximum, Modell said.

State Department spokesperson Tammy Bruce told reporters that Trump had signaled what he wanted to happen and that his administration is focused on delivering that. She would not say what the process would entail.

"But clearly we are focused on making sure that (the) guiding hand of President Trump prevails and moves this government forward, so we will have to wait and see when it comes to what that ends up looking like," Bruce said.