Suffocating Iran’s Economy: Washington Hints at an “Unprecedented Blockade”
Washington – Agencies: The United States is preparing to impose unprecedented economic pressure on Iran. U.S. Treasury Secretary Scott Bessent said the U.S. is moving to tighten the economic noose around Tehran, even as Iran is already subject to thousands of sanctions alongside a naval blockade on its ports. Although Washington has not yet disclosed the nature of the measures it intends to take, the Treasury Department still possesses a number of tools that can be used to increase pressure on Iran. Below are the top five potential options on the table for U.S. President Donald Trump, according to Bloomberg:
Relations with China: China buys more than 90% of Iran’s oil exports, making sanctions on entities that facilitate these purchases a direct way to cut Tehran’s oil revenues. Washington has already sanctioned some small Chinese refineries and companies linked to them since the start of the U.S. campaign against Iran in late February. However, it has so far avoided targeting major Chinese banks that finance this trade. Targeting Chinese companies or financial institutions carries risks of escalating tensions with Beijing, particularly ahead of the anticipated meeting between President Donald Trump and his Chinese counterpart, Xi Jinping. There are also potential economic repercussions, as reducing Iran’s oil exports could deprive the global market of low-priced crude, potentially driving up already high oil prices.
Money Exchange Companies: Several money exchange firms in countries that assist Iran help repatriate funds into the country. After oil sales are completed, Tehran needs money exchangers and brokers to convert payments, often received in Chinese yuan, into currencies it can actually use. The U.S. Treasury has already indicated that this channel is a vulnerability for Iran, having sanctioned some Iranian money exchange companies as part of Bessent’s campaign dubbed “Economic Wrath,” accusing them of helping launder billions of dollars in foreign currency. Targeting these firms would limit Iran’s ability to access a significant portion of its funds, although Tehran has spent years building alternative channels to move money outside the formal financial system.
Secondary Sanctions: The United States could threaten secondary sanctions on any entity conducting even limited transactions with Iran, following the approach Trump took toward North Korea in 2017. This step could force foreign companies and banks to choose between continuing dealings with Iran and maintaining access to the U.S. financial system, potentially expanding Washington’s influence beyond entities directly linked to Iranian oil trade.
Iranian Assets Abroad: The United States could go beyond freezing Iranian government assets and seek to confiscate assets already within its jurisdiction, based on an action taken by the George W. Bush administration after the 2003 invasion of Iraq. However, the volume of Iranian government assets actually under U.S. control may be limited. Moreover, confiscating them would be more complex legally and diplomatically than simply freezing them. A large portion of Iran’s overseas wealth is concentrated in third countries, meaning Washington would need the cooperation of foreign governments to confiscate it.
The Secret Fleet: While the U.S. naval blockade has reduced shipping traffic to and from Iranian ports, Washington may consider expanding its operations to include more comprehensive efforts. These measures could target not only individual ships but also companies, terminals, and other infrastructure that facilitate shipping operations associated with what is known as the “secret fleet.”
