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Sanctions and “Economic D-Day”
The United States is preparing to announce new sanctions against Iran as Washington seeks to ratchet up pressure on Tehran after diplomacy stalled over ending the war on Iran, with Al Jazeera describing the measures as “unprecedented” economic pressure.
““unprecedented” economic pressure”
In a Truth Social post on Wednesday, Donald Trump said Iran had “failed to take” the opportunity to make a deal and would face “economic warfare and isolation on an unprecedented scale,” while threatening sanctions against any country that does business with Iran.
Treasury Secretary Scott Bessent told CNBC that the US would apply the “toughest sanctions in history” on Iran, saying it was a “one-two punch” with the blockade and sanctions.
Iran’s Foreign Ministry spokesman Esmaeil Baghaei said the US announcement was “an assertion of extraterritorial sovereignty” against the United Nations’ member states, warning that no state can compel foreign banks, enterprises or airports to renounce commerce with Iran.
The US campaign is framed as building on “Operation Economic Fury,” including a naval blockade on Iranian ports and targeting companies, brokers and tankers accused of helping Iran sell its oil abroad, as Al Jazeera reports.
Rial hits record low
As Washington prepared to announce more sanctions, Iran’s rial hit a record low Monday, dropping to 2.02 million to the U.S. dollar as trading opened on currency markets, according to the Associated Press.
The AP reported that Iran’s official Central Bank rate stood at around 1.5 million rial to the dollar, but the market rate is what most Iranians pay, and it said the rial had repeatedly hit new lows as nearly six months of war took an even greater toll.
The AP tied the economic pressure to the US naval blockade and to Iran’s strategic advantage in the Strait of Hormuz, where it said Iran’s attacks and threats on ships brought traffic “to a near halt,” damaging the world economy and heaping pressure on Donald Trump ahead of congressional elections.
Ahead of the announcement, Trump posted on social media that “IRAN IS COMPLETELY COLLAPSING!!!,” while the AP said U.S. Treasury Secretary Scott Bessent wrote in the Financial Times that the regime’s “final refuge” lay in “the self-deception of fearful nations.”
The AP also reported that the United Arab Emirates announced it was suspending all trade with Iran, and that Iranian Foreign Ministry spokesperson Esmail Baghaei told reporters in Tehran that “any escalation of this situation will undoubtedly bring about consequences.”
Regional talks and retaliation
While the US prepared new sanctions, Pakistan’s army chief Asim Munir traveled to Tehran on Monday to encourage the US and Iran to return to negotiations, with the Associated Press reporting that a high-level delegation arrived to de-escalate tensions.
“will be regarded as an enemy”
The AP said Oman’s foreign minister was set to visit Iran on Tuesday, and it described the talks as part of efforts to manage commercial shipping traffic through the Strait of Hormuz, where Iran was refusing to fully reopen it unless it could charge ships.
In parallel, Iran threatened retaliation against countries that join the US in economic sanctions, with Al Jazeera reporting that Mohsen Rezaei warned any country that takes part in imposing economic restrictions on Iran “will be regarded as an enemy.”
Bloomberg Línea reported that Iran’s currency weakened to a historic low against the dollar after having fallen 4.5% since Trump last week announced plans to intensify economic pressure, and it said Bessent wrote in the Financial Times that the objective was to “cut every economic thread that sustains the tyrannical regime until Tehran is left alone.”
The Associated Press reported that in downtown Tehran, 73-year-old Sadegh Mahmoudi joined a line of about a dozen people to purchase U.S. dollars with his remaining savings, saying, “There is no hope for a deal and peace,” as sanctions pressure intensified.