Top U.S. and Chinese economic officials met in Stockholm on Monday to try to extend a tariff and export control truce by another 90 days, hoping to defuse escalating tensions and prepare the stage for a potential summit between President Donald Trump and President Xi Jinping later this year.

U.S. Treasury Chief Scott Bessent and China's Vice Premier He Lifeng arrived at Sweden's Rosenbad government offices for a new round of discussions aimed at preserving tentative deals struck in May and June. Without an agreement by August 12, tariffs could revert to triple-digit levels, disrupting global supply chains and effectively triggering a bilateral trade embargo between the world's two largest economies.

U.S. Trade Representative Jamieson Greer cautioned against expecting immediate results, saying the goal is to monitor compliance, ensure the flow of critical rare earth minerals, and maintain the diplomatic track. "I don't expect some kind of enormous breakthrough today," Greer told CNBC. "We're laying the groundwork for enhanced and balanced trade going forward."

The talks follow Trump's latest trade agreement with the European Union, which imposes a 15% tariff on most EU exports, including autos, adding urgency to China's push for reduced U.S. tariffs and looser technology export controls.

Trade experts see a 90-day extension of the U.S.-China truce as likely. Such a pause would allow both sides to avoid immediate economic disruption and plan a potential Trump-Xi meeting in October or November.

According to The Financial Times, the U.S. has temporarily paused curbs on tech exports to China, including AI chips and sensitive components, to support ongoing negotiations and smooth the path toward a high-level meeting.

However, broader issues remain unresolved. Talks earlier this year in Geneva and London focused narrowly on tariff rollbacks and restoring the flow of rare earth minerals, but failed to tackle the core disputes. These include U.S. allegations that China's state-led export model floods global markets and Beijing's claim that U.S. tech curbs aim to stunt Chinese growth.

"Geneva and London were really just about getting the relationship back on track," said Scott Kennedy, a China expert at the Center for Strategic and International Studies. "They haven't yet addressed the structural disagreements at the heart of this conflict."

Bessent has already hinted at extending the deadline and pushed for China to shift toward domestic consumption, a long-standing U.S. goal.

Analysts warn that resolving the U.S.-China economic standoff will be far more complex than recent agreements with the EU or other Asian partners. China's control of rare earth minerals-used in defense systems, electronics, and vehicles-remains a critical leverage point.

Any resurgence of tariffs or tech restrictions could derail Trump's rumored China trip, further souring relations and destabilizing trade flows. For now, all eyes are on Stockholm and the fragile diplomatic bridge being built-one negotiation at a time.