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Treasury Secretary Scott Bessent on Monday unveiled a sweeping campaign of financial sanctions and diplomatic pressure designed to sever Iran's remaining links to the global economy, but he declined to say which countries would be targeted or when new penalties on Iran's trading partners would take effect.
Dubbed "Operation Economic Outcast," the initiative is aimed at closing loopholes in the existing U.S. financial dragnet around Iran and, Bessent said, forcing an "endgame" in the conflict that President Donald Trump launched in February.
Treasury officials said they are adding five sectors of the Iranian economy to their target list: cryptocurrency used by the Islamic Revolutionary Guard Corps and regime insiders; weapons-related technologies; gold used to stabilize the plummeting Iranian currency; Iran's airlines; and shipping that carries weapons components and oil. They also announced sanctions on 60 entities, individuals and vessels that enable Iran to procure nuclear or missile technology, conduct cyber operations, and sell oil.
Bessent said Trump is contacting other world leaders to demand that they support the United States in seeking the "economic asphyxiation of this regime." He would not identify the leaders contacted or provide a deadline for action. Iran's top trading partners include China, the United Arab Emirates, Turkey and Iraq.
"The United States expects action," Bessent told reporters during a news conference at the Treasury Department in Washington. "We do not have infinite patience here."
Asked why the U.S. isn't imposing widespread sanctions right away, Bessent said t
he administration wants to give countries an "opportunity to remedy bad behavior." "Why would I want to blow up the global financial system?" Bessent said. "We believe that a warning shot and a level-set of expectations is appropriate."
Some independent specialists found Monday's announcement underwhelming, especially after days of increasingly bellicose warnings from Trump and Bessent about mounting an "economic D-Day" against Iran and its commercial partners. In an opinion piece published Sunday in the Financial Times, Bessent wrote that the United States had "significantly dismantled Iran's military capabilities and weakened its nuclear programme" and on Monday would launch the "single greatest financial offensive ever marshalled against an adversary."
But Bessent left unresolved what many analysts see as a key issue: whether the administration is prepared to take on China one month before President Xi Jinping is due in Washington for an official state visit.
"I think the big question is going to be whether they're willing to do something that crosses the red line of the China trade truce. And if not, you know, this is ultimately not going to be successful," said Matt Swinehart, a former Treasury official who served under presidents of both parties and is now with Rock Creek Global Advisors in Washington.
The administration's plan to pressure foreign leaders directly is likely to pay off, he said. But genuine progress will come only if the U.S. penalizes privately owned Chinese oil refineries, known as "teapots," and the large Chinese banks that facilitate Beijing's purchases of Iranian oil, Swinehart said.
Asked whether Chinese banks would be among those hit with the punishing financial measures, Bessent replied that "no one is above the reach of U.S. sanctions."
Swinehart said Monday's announcement seemed to be a sign that the administration had all but exhausted its weapons for confronting Iran. "It's only now that I think the administration has realized it doesn't have a lot of other options," he said. "You do have to wonder why they didn't do this before."
Adam Smith, who worked on Iran sanctions in the Obama administration, said Bessent's strategy could be effective: Intense pressure on Iran's financial lifelines ultimately produced the 2015 nuclear deal with the U.S.
"If even some of what Bessent said comes true, this is a significant increase of pressure. If this goes on - plus the physical blockade - it could actually have an impact," said Smith, now a partner at Gibson Dunn, a global law firm.
The question is how other entities view Bessent's "warning shot," said Rachel Ziemba, an adjunct senior fellow at the Center for a New American Security, a bipartisan nonprofit focused on national security.
"It's not clear to me that the rhetoric matches with the willingness to implement," she said. "There aren't a lot of good additional options on more economic pressure on Iran because all of them come with economic or geostrategic costs."
Monday was not the first time the Trump administration has said that it was dialing up pressure on Iran. Trump has repeatedly put sanctions on foreign companies involved in the oil trade that represents Iran's principal source of revenue, even as his military campaign against Tehran has flirted with stalemate.
During Trump's first term, the U.S. employed what he called a "maximum pressure" sanctions campaign against the Islamic republic. And for the past year - long before February's military attack - the administration has carried out "Operation Economic Fury" in hopes of forcing Iran to submit to American demands to give up its nuclear weapons program.
More broadly, some U.S. sanctions against Iran date back to 1979, when the Islamic republic took U.S. diplomats hostage and held them for 444 days.
Over the years, sanctions have become an almost reflexive tool of American power, a way to accomplish foreign policy goals that Washington is unable or unwilling to attempt with military force. But it carries a mixed record of success.
Among the 37 sanctions programs administered by Treasury's Office of Foreign Assets Control, the oldest targets Cuba. President Dwight D. Eisenhower first imposed financial sanctions on the island's communist government in 1960. His successor, President John F. Kennedy, broadened them into a full trade embargo. Though its economy is a wreck and its people lack routine access to electricity and other essentials, Cuba today remains under communist rule.
In Tehran, Iranian Parliament Speaker Mohammad Baqer Qalibaf on Monday dismissed Washington's threats as "big talk" and predicted that Iran's trade partners would not comply with U.S. sanctions.
"Iran's trade partners have also announced to us, both through the media and by sending messages, that they regard these statemen
ts as utterly meaningless," Qalibaf said in a Farsi-language post on his X account. Before Bessent's news conference, Iranian Deputy Foreign Minister Kazem Gharibabadi also mocked the treasury secretary's claims that Iran's military capability had been dismantled.
"You say … 100% of military factories destroyed, and the nuclear program buried," Gharibabadi wrote on social media. "Yet for the very same Iran, the largest financial offensive in history and the mobilization of all U.S. agencies and authorities have become necessary! Is this a victory or an admission of U.S. defeat?"
The war has reached a near-stalemate in recent weeks, even as a ceasefire agreement expired last week. The hostilities have for months disrupted shipping through the Strait of Hormuz, a key channel through which around 20 percent of the world's oil moved before the war.
That disruption has pushed up oil and gas prices in the lead-up to the midterm elections in early November, in which Republicans are hoping to maintain control of the House and Senate. Most Americans disapprove of the war, polls show, contributing to record low approval ratings for Trump.
This weekend, Mohsen Rezaei, the head of Iran's national security council, vowed that "not a single drop of oil" will be exported through the Persian Gulf if the U.S.-led "economic war continues."
"Iran will regard any country's participation in or support for America's economic war against the Iranian people as an act of war," he wrote on X.
Iran's threats against ships transiting the Strait of Hormuz have helped to maintain the country's leverage. But Iran's currency hit a record low Monday, and skyrocketing inflation has made life unaffordable for many Iranians.
"The "Iranian government may sound bullish on their capacity to absorb the pain. But the pain is already there … And it is going to increase across the board," said Naysan Rafati, the senior Iran analyst for International Crisis Group, an independent organization that works to prevent war.
What is unclear is whether that pain will lead to some sort of diplomatic breakthrough, he said. Last week, he noted, after a call between UAE President Mohamed bin Zayed Al Nahyan and Trump, the UAE announced that it would halt all trade ties with Iran, though Iran's ties with the UAE and neighboring countries date back generations.
"The idea of a total financial blackout of Iran is difficult to imagine," Rafati said. "But it doesn't mean the U.S. can't have a substantial impact."
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