if the US said 'we cancel all your treasury securities' it would be effectively the US defaulting on a couple hundred billion dollars worth of debt. when you default on your debt, your 'credit rating' goes to crap and nobody wants your currency anymore. the middle east could move oil off the dollar if China wanted them to, think if China was a bigger customer than the US was, why wouldn't they just move oil to sell in Euros or RMB?
secondly, what if they just decided to short the US dollar and liquidate their treasuries at the same time? why not?