US Treasury Secretary Scott Bessent yesterday unveiled sweeping new sanctions aimed at the "economic asphyxiation" of Iran, expanding Washington's secondary sanctions threats and warning any country that fails to join the campaign will "share in the isolation" of Tehran.
The announcement, which Bessent had earlier billed as an "economic D-Day," came almost six months into a war that has ground into stalemate, with peace talks stalled and Iran continuing to block most traffic through the Strait of Hormuz, a vital corridor for global oil and gas supplies.
"Around the globe, our objective is to sever every economic lifeline that sustains this tyrannical regime until Tehran stands alone," Bessent told reporters. "We are going to hold everyone accountable, and this is economic asphyxiation of this regime."
He gave no timeline and named no specific countries, but said President Donald Trump was personally calling world leaders to press them to cut ties with Tehran. The Treasury Department said the expanded sanctions would target Iran's digital assets, technology, gold, aviation and shipping sectors, alongside new sanctions on 60 individuals, companies and vessels accused of helping Iran generate oil revenue, procure weapons and conduct cyber operations.
The measures hit entities in the UAE, Hong Kong, China, Singapore and Europe. Bessent warned that any entity "that facilitates money laundering on behalf of Iran will be removed from the US dollar system," adding pointedly that "no-one is above the reach of US sanctions" when asked whether Chinese banks would be targeted.
China, the largest buyer of Iranian oil in recent years, has already seen its imports curbed by a US naval blockade renewed in mid-July. Analysts say Washington remains wary of provoking Chinese retaliation ahead of expected talks next month between Trump and President Xi Jinping, particularly given Beijing's leverage over critical mineral exports. China's foreign ministry said sanctions and pressure tactics "do not help," and that it would act to protect its own interests. Trump has also threatened tariffs on countries doing business with Iran, including Turkiye, Iraq and India, although the Supreme Court has since struck down the legal basis for such levies.
Iran's Deputy Foreign Minister Kazem Gharibabadi dismissed the sanctions push as an admission of military failure, questioning why Washington needed "the largest financial invasion in history" if it had already achieved its aims. "Is this a victory or an admission of America's defeat?" he asked.
Iran, which has endured decades of sanctions without its leadership being dislodged, has hit back by warning shipping against passing through the Strait of Hormuz without permission, listing 45 vessels it accuses of violating its rules and threatening retaliation over any ship-to-ship transfers involving them.
The US blockade has already driven Iranian oil exports through the strait down from 2mn barrels a day before the war to just 0.4mn by mid-August, according to maritime tracker Kpler. A projectile struck a tanker off the Saudi port city of Yanbu in the Red Sea on Monday, sparking a fire on deck; Iran's Houthi allies, who last month vowed to block Saudi oil exports rerouted through the Red Sea, claimed the attack, which Saudi Arabia's national shipping company confirmed.
Diplomatic efforts continue in parallel. Pakistan's army chief, General Asim Munir, was in Tehran yesterday for talks with parliamentary speaker and chief negotiator Mohammad Bagher Ghalibaf, days after Trump reportedly called Munir to urge Iran back to the negotiating table. Islamabad, a key mediator behind April's since-collapsed ceasefire, is also a major trading partner of Iran, potentially exposing it to the new US measures. Oman's foreign minister was due in Tehran today, as Muscat seeks a deal with Iran on regulating passage through Hormuz.
For ordinary Iranians already battered by inflation that fuelled mass protests in December and January, the escalation promises further hardship. "I don't think people can really take this much longer," said Sarah Hassanbeigi, a 32-year-old Tehran pharmacist.