US Treasury Secretary Scott Besent announced a new round of sanctions targeting Iran on Monday and warned every country that does business with the Islamic Republic to cut those financial ties or face retaliation from the United States.
President Donald Trump’s pledge last week to unleash an “Economic V-Day” against Tehran turned out to be new warnings to isolate Iran from the rest of the global economy. Asked why the United States did not impose secondary sanctions on Iran’s trading partners, Besant told reporters that he wanted countries to have the opportunity to distance themselves from Iran before it was too late.
“Why would I want to blow up the global financial system?” Besant said.
The Trump administration is struggling to find a way out after nearly six months of an unpopular war with an increasingly stubborn Iran. Washington promised that imposing new sanctions would increase pressure on the Iranian economy already affected by previous sanctions and the US naval blockade.
But Monday’s announcement provided few details and did not name countries that could face secondary sanctions. China, Turkey and the United Arab Emirates are Iran’s largest trading partners.
“We agree with each country to tell them our expectations,” Besant said. “We know who they are. They know who they are.” “So when the hammer of US Treasury action comes down on them, they will have no one to blame but themselves.”
Calling the campaign “Operation Economic Pariah,” Besant said Trump is “making phone calls to world leaders with specific requests to stop their interactions” with Iran and has already seen results.
Last week, the UAE announced the suspension of all commercial transactions, commercial exchanges, and financial transactions with Iran until further notice, after the missile attack on the Gulf country. Besant said that the UAE’s decision “is not a coincidence.”
Shortly before the announcement, Iranian Parliament Speaker Mohammad Bagher Qalibaf said that the United States is not in an economic position that allows it to further restrict Tehran’s relations with other countries.
“Iran’s trading partners have made clear, both in the media and through letters sent to us, that they do not take these statements into account anywhere,” Ghalibaf, who has been Iran’s chief negotiator for the past six months, said on X.
Besant is pressed on what the new campaign means for China
In response to a question about whether the United States would target China, Besant said that “no one is above the scope of US sanctions,” despite the fragile trade truce existing between the world’s two largest economies.
“If they facilitate transactions and are part of the ecosystem that turns Iranian oil into money and into repression, they will be targeted,” he added.
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Experts say the United States is likely to carefully calibrate its actions regarding China, just one month before Chinese leader Xi Jinping’s expected visit to the United States.
How significant the announcement is “depends on how forcefully President Trump is willing to implement it,” said Ali Wein, senior research and advocacy adviser for US-China relations at the International Crisis Group. So far, despite the threat of dire economic consequences for countries that trade with Iran, he has largely given China a pass.
The Treasury Department said on Monday it had imposed sanctions on nearly 60 entities linked to Iran, accusing them of roles in Iran’s nuclear and missile programs, cyber activities and oil shipments.
This includes Hong Kong-based Sweet Ocean Industrial Limited and associated persons and companies, which has been accused of helping Iran obtain sensitive goods such as laser optical equipment. China-based Shenzhen Huamei, a service provider to Iran-based logistics company BRE Line, as well as BRE Line’s Hong Kong subsidiary, were also sanctioned for allegedly supporting missile and nuclear programmes.
The Iranian currency falls to a record level
Hours before Besant’s announcement, the Iranian currency reached a record low.
The riyal fell to 2.02 million against the US dollar with the opening of trading in the currency markets. The official exchange rate of the Central Bank of Iran is about 1.5 million rials to the dollar, but the market rate is what most Iranians pay.
The currency was already under pressure before the United States and Israel attacked Iran on February 28, with Iran facing double-digit inflation and negative growth. The riyal has repeatedly reached new lows, as the nearly six-month-old war has caused heavy losses.
Iranians are finding daily staples increasingly unaffordable. Since the start of the war, the price of rice has risen by about 60%, and beef prices have risen by more than 150%. The International Monetary Fund expects GDP to contract by more than 5%.
However, economic pressures have not yet translated into political pressures. Iran maintains a key strategic advantage: Its attacks and threats against ships in the Strait of Hormuz have halted traffic in the vital waterway, damaging the global economy and increasing pressure on US President Donald Trump ahead of the congressional elections.
As a result, the war turned into a struggle over who controlled the strait, through which a fifth of global oil trade passed before the conflict. Iran now refuses to fully reopen it unless it can ship ships.
Iran and Oman, which are located on the other side of the strait, are reportedly in the final stages of agreeing on a plan to jointly manage the waterway. The Omani Foreign Minister is scheduled to visit Iran on Tuesday.
A Pakistani delegation visits Iran
Pakistan, which played a key role in brokering a 60-day ceasefire in June, sent a high-level delegation to Iran on Monday to encourage the United States and Iran to return to negotiations, two senior officials said. The officials spoke on condition of anonymity because they were not authorized to speak to the media.
The army only confirmed Field Marshal Asim Mounir’s visit, saying it aimed to calm tensions in the region.
Trump spoke with Mounir before the army chief’s visit to Iran, according to a person familiar with the discussion who spoke on the condition of anonymity to confirm the private conversation. Reuters quoted Pakistani sources as the first to report the call.
Mounir met with Iranian Interior Minister Eskandar Momeni in Tehran, according to the two senior officials. Munir was accompanied by Pakistani Interior Minister Mohsin Naqvi and other officials. Munir is expected to stay in Iran overnight and meet the Iranian President and other senior officials before returning to Pakistan.
His previous visit to Tehran in May helped pave the way for a memorandum of understanding signed by the United States and Iran in June.
In downtown Tehran, 73-year-old Sadegh Mahmoudi had no hope of reaching a solution. He joined a line of about a dozen people to buy US dollars with his remaining savings to hedge against further declines.
“There is no hope of reaching an agreement or peace,” he said.
Amiri reported from New York. Associated Press writers Nasser Karimi in Tehran, Iran; David Rising in Dubai, United Arab Emirates; Seung Min Kim in Washington; Munir Ahmed in Islamabad contributed.
