Treasury Secretary Scott Bessent announced on Monday a “sustained financial attack” against Iran, for which he demanded that governments around the world, and their companies, end their ties with the Islamic Republic. Otherwise, those countries will face harsh secondary sanctions. “Time is running out,” he warned at a press conference in Washington.
In his statements, Bessent said that the U.S. president is already in talks with other foreign leaders to make it clear that they must comply with the economic embargo against Iran. Any country “foolish enough” to help Iran will be sanctioned, he said, emphasizing that for now, his government is firing “a warning shot.” “Each country has a defined deadline to cease the activities we have identified. If they do not take action, we will do so unilaterally through the Treasury Department authorities,” he added.
As the war against Iran is about to enter its seventh month, the Trump Administration has decided to change tactics and announced with great fanfare an economic D-day against Iran that was to be detailed this Monday.
“We are launching an economic holocaust against Iran’s financial connections worldwide. Our goal is to cut every economic lifeline that supports this tyrannical regime until Tehran is completely isolated,” the Treasury Secretary pointed out. According to him, his Department already knows the networks, financial channels, and aids Iran uses to sell oil abroad and evade sanctions.
Bessent stressed that the regime can now choose between isolation and economic ruin or a return to normality and the global economic community. “I want to be clear: any entity that facilitates money laundering on behalf of Iran will be excluded from the U.S. dollar system. The clock has already started ticking,” he stated.
In Washington, the evidence seems to be accepted that the purely military bet has failed: the United States has squandered tens of millions of dollars in its deployment in the Middle East while the Iranian regime remains standing. The Strait of Hormuz remains almost completely closed, despite the U.S. president insisting, against all evidence, that ships can cross it normally. Diplomatic options to resolve the conflict are also at a standstill: the Republican declared last week that there are neither ongoing talks with Tehran nor planned ones in the future, following the deadlock in the negotiation process that the two countries agreed on in June.
Trump himself proclaimed last week the shift towards economic warfare, with which he aims to replicate at least in part the suffocation tactic he also hopes to trigger political and economic changes in Cuba. In a message on his social networks, he announced the “most devastating economic operation in history,” an “economic war and isolation on an unprecedented scale.”
It remains to be seen now how effective the measures may be. Iran has been under sanctions for five decades and has learned to survive in isolation. Since the start of the war on February 28, it has developed a resistance economy that has replaced imports, dispersed its power plants, and established a structure that resorts to a black market and a ghost fleet similar to the Russian one to evade sanctions.
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It also remains to be seen what response the United States will get from those governments that maintain relations with Tehran. China, which with its purchase of Iranian oil has been one of the great supporters of the Islamic Republic’s economy, has said it will take the “necessary measures” to protect its interests. A spokesperson for the Chinese Ministry of Foreign Affairs said the country “will closely follow” the situation’s evolution and take measures to safeguard its “legitimate rights and interests,” but without specifying them. The spokesperson also warned that sanctions and pressure “do not help solve problems.”
And economic sanctions, historically, usually take time to take effect. Something that does not fit with Trump’s impatient character. If diplomatic negotiations are at a dead end, it is partly due to the U.S. president’s little willingness for slow-burn negotiations.
“Effective sanctions require a coalition of states willing to enforce them to isolate a harmful actor. However, the Administration seems to have strived to distance key partners. Iran has already demonstrated its effectiveness in evading sanctions and possesses a special ability to use cryptocurrencies and decentralized finance platforms. The Administration will need to have the will to adopt the necessary regulatory and control measures to close these evasion routes in collaboration with the sector,” points out Andrew Miller, from the think tank Center for American Progress, of Democratic ideology.
Furthermore, “both Iran and other countries that could be affected by these sanctions will almost certainly retaliate, increasing the risk that this policy will be as counterproductive as each of the measures adopted by the Trump Administration to date,” this expert considers.
Iran is already showing defiance. Just hours before Bessent’s press conference, it threatened 46 ships with fines or capture, boasting that it controls the Strait of Hormuz, the strategic maritime passage turned into the key point of the war and suffering a double blockade: Tehran’s and the United States’. In a message posted on the social network X, the Persian Gulf Strait Authority, created by Iran, declared that the ships, mostly from neighboring countries, had violated the “protocols” for transit through this route. According to this body, “they may face restrictions on future crossings, including fines, detention, or confiscation.”
Previously, the head of the Iranian Supreme National Security Council, Mohsen Rezaí, had warned neighboring countries that if they join the U.S. economic war against Tehran, they would be considered enemies and, therefore, attacked.
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