WASHINGTON: A new economic front is emerging in the U.S.-Iran conflict, with Treasury Secretary Scott Bessent saying Thursday that Washington is preparing its toughest sanctions yet against Tehran.
The announcement followed President Donald Trump’s threat of sweeping financial penalties for countries that help Iran.
Bessent said the administration will provide details of the sanctions package at a news conference Monday. He suggested that maximum economic pressure could reduce the need for another major military escalation.
Speaking to CNBC, Bessent said, “If we are doing the maximum economic pressure, then that likely means that there will not be a large-scale kinetic restart.”
Trump had warned Wednesday of “Economic Warfare” and unprecedented isolation against Iran. He said countries whose financial institutions, businesses, airports or government entities provide Tehran with “any type of lifeline” would face what he called “tremendous Economic Consequences.”
Bessent described the strategy as a “one-two punch,” combining a U.S. naval blockade imposed on Iran in April with the new sanctions package. The blockade was paused for a month in mid-June.
The nearly six-month-old conflict has killed thousands of people, drawn Gulf nations into the crisis and disrupted global energy markets. Iran’s ability to restrict shipping through the Strait of Hormuz has intensified concerns over energy supplies, as the waterway carried about one-fifth of all traded oil before February.
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Oil prices rose to a more than three-week high Thursday as investors assessed the potential impact of Washington’s latest measures. Prolonged disruption around the Strait of Hormuz could affect global energy supplies and fuel costs.
The United States and Iran have announced ceasefire agreements twice, in April and June, seeking to restore shipping through the strategic waterway and move toward ending the conflict. Both agreements quickly collapsed.
Iran has faced extensive U.S. sanctions for nearly five decades, dating to the 1979 Islamic Revolution. Tehran has rejected the latest measures, maintaining that economic pressure will not alter its position.
Iran’s Foreign Ministry condemned the U.S. economic and trade sanctions as “economic terrorism” and said they would not weaken the country’s determination to protect its independence, dignity and national sovereignty.
Bessent said Monday’s announcement will outline how Washington plans to expand its economic campaign and identify the targets of the new restrictions.
The measures could also test U.S. relations with China, Iran’s largest oil customer. Kpler data showed China purchased more than 80% of Iran’s shipped oil in 2025.
When asked whether Washington could penalize Chinese entities involved in Iranian trade, Bessent said some discussions were better handled privately. He also argued that China has a strong interest in maintaining reliable energy supplies from the Gulf.
China’s embassy in Washington opposed the sanctions approach, saying economic pressure would not resolve the dispute and urging the parties to pursue political and diplomatic solutions.
The latest escalation comes as Trump faces pressure over the cost of the conflict. Higher fuel prices have weighed on his approval ratings and could create challenges for Republicans ahead of the November midterm elections.
Iranian Foreign Minister Abbas Araqchi accused Trump of using the confrontation to shift attention away from economic difficulties in the United States, including record government debt and rising interest rates.
Araqchi said Washington’s continued reliance on policies that Tehran considers unsuccessful would lead to further setbacks and deepen tensions.
Trump’s previous social media threats and policy announcements have not always been implemented exactly as stated, leaving uncertainty over the final scope of the proposed measures.
