Treasury Secretary Scott Bessent announced plans for a wave of new sanctions Monday aimed at further isolating Iran, after threatening the Islamic Republic with “an economic D-Day.” The sanctions will target international entities engaged in facilitating Iranian trade related to shipping, oil, crypto, gold and aviation. He said President Donald Trump was making phone calls to world leaders with “specific requests” to cease trading with the Iranian regime. Bessent said the U.S. was launching an “economic onslaught” against Iran’s financial connections “around the globe” in order to “sever every economic pipeline” used by Iran “until Tehran stands alone.” Bessent said the U.S. was engaging in “quiet diplomacy” with Iranian trade partners to warn them of the consequences for continuing to trade with Tehran.
Any entity that facilitates money laundering on behalf of Iran will be removed from the U.S. dollar system, he said. Yet Bessent did not lay out any immediate concrete actions. Markets showed little reaction to Bessent’s remarks.
The U.S. has for decades imposed direct sanctions on Iran and any businesses involved in prohibited activities like weapons procurement. But Iran has, in many cases, successfully evaded the sanctions by standing up new front companies. Bessent promised Sunday to launch “the single greatest financial offensive ever,” in an op-ed in the Financial Times.
Monday’s actions are designed to target “secondary” countries whose trade and business relations still benefit Iran. Ahead of the announcement, the United Arab Emirates, a close U.S. ally whose leadership has forged close ties with the Trump administration, announced it was ending all trade relations with Iran. Experts say the success of Bessent’s announcement will hinge on whether Iran’s most powerful trading partners — China, India, and Russia — decide the U.S. threats are credible.
The U.S. has racked up its own costs. Defense Secretary Pete Hegseth said last month that the war has cost the U.S. $37.5 billion, though estimates put the all-in economic impact at as much as $150 billion. Moody’s Analytics Chief Economist Mark Zandi told NBC News last month he estimated the war has cost the average U.S. household more than $1,200 in higher energy and grocery costs alone.
The war has also become a political liability for Trump ahead of November’s midterm elections, with his approval rating dropping to its lowest level of either of his presidential terms. Economists say that in addition to higher gas prices, the war has also helped contribute to the current turmoil in the bond market that’s led to extraordinary intervention by the Treasury Department. While Bessent was speaking Mohammad Bagher Ghalibaf the speaker of Iran’s Parliament, who until recently had been leading Iran’s negotiation team to end the war, took to X.
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