Barack Obama's announcement on Friday that there are sufficient reserves of oil worldwide to allow sanctions against countries that continue to purchase Iranian oil in three months, sets the scene for the president's most serious foreign policy challenge since his inauguration. At the end of June, four months before the elections, he will have to decide whether to place sanctions on Chinese banks that hold $1.13 trillion of American debt and on those of the world's largest democracy, India.

Such an outcome seems almost unthinkable, but as both nations have no plans to cut down on their purchase of Persian oil, (the two countries are the biggest importers of oil from Iran, together representing 35 percent of its oil exports in 2011) any hesitation by Obama to punish either country will make a laughing stock of his sanctions. The Republican campaign will not relinquish this chance to accuse Obama yet again of being soft on Iran and Benjamin Netanyahu, who by this stage himself may also be fighting an election, will have a claim against Obama that the sanctions are not working and a military strike is the only way to block Iran's nuclear path.

Who will Obama take on at this stage? Netanyahu, the Republicans and the pro-Israel lobby or India and China?

He will have to maneuver with a skill he has yet to exhibit in his diplomatic dealings in order to prevent facing this dilemma. This makes the yet to be confirmed talks in Istanbul in two weeks all the more crucial. If the talks do not deliver a significant Iranian concession, Obama will have to hope that those countries that agreed to cut their purchase of Iranian oil will create enough pressure on the regime to cause it to relent.

June 30 is crunch-time for Obama.