The U.S. is set to unveil its plan for the “toughest sanctions in history” against Tehran on Monday after days of threats about an “economic D-Day”. Treasury secretary Scott Bessent called the impending measures “the single greatest financial offensive ever marshalled against an adversary” in an op-ed in the Financial Times published on Sunday. Bessent is expected to make the announcement at a press conference at around 7pm BST (2pm ET).
Iran’s currency hit a record-low on Monday amid the threats. Iran has threatened an “earthquake-like” retaliation if the U.S. went ahead with its plan and warned Gulf neighbours against supporting or joining the sanctions. The measures are expected to impact Tehran’s trading partners including China.
Tehran called the threats “economic terrorism” with foreign minister Abbas Araghchi saying that the scheme would only bring President Donald Trump “further defeat”. US economic terrorism threatens global economy and sovereignty worldwide.” The U.S. had agreed to lift sanctions on sales of Iranian oil for the duration of a 60-day ceasefire that expired last Monday, but these were reimposed after the deal collapsed amid disagreement over the Strait of Hormuz last month. For decades, it has imposed measures such as freezing assets, implementing trade embargoes and applying sanctions against Iran over issues such as its nuclear development and human rights violations.
Since the war, Washington has also imposed a naval blockade, restricting Iranian oil exports as well as levying additional maritime and energy sanctions since the war broke out. Trump could escalate the situation by imposing secondary sanctions on third parties. However, he is limited in what he can enforce, say experts.
Iran appears to have profited from the outbreak of conflict, with the country’s semi-official Fars news agency reporting that the country generated $7.5bn in oil revenues over the first four months of the year. Citing the Iranian oil ministry, the agency said that this marked a revenue that is 1.5 times larger than the amount generated in the same period last year and is expected to cover the government’s foreign currency expenses for the rest of the year. These figures could not be independently verified.
Iran has developed ways to circumvent the worst impact of sanctions, including the use of shadow fleet tankers, floating storage and the use of alternative ports. Dr Quilliam says that while further sanctions could increase pressure on Iran’s economy, alone they are unlikely to be decisive. On Monday, China’s foreign ministry said that Beijing would be monitoring the developments closely and would do what is necessary to protect its rights.
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