US Treasury signals 'economic D-Day' as Iran warns of oil export halt
Washington aims to sever all economic ties with Tehran, threatening secondary isolation for partner nations, while Iran moves to control the Strait of Hormuz.
US Treasury Secretary Scott Bessent has characterised the current economic standoff with Iran as the "endgame," announcing what he described as "the single greatest financial offensive ever." In an opinion piece for the Financial Times, Bessent stated that the United States intends to sever all economic ties with Tehran in a move he termed an "economic D-Day."
The Treasury Secretary warned that the objective is to sever every economic lifeline sustaining the Iranian regime until Tehran stands alone. Crucially for global markets, Bessent indicated that any nation maintaining financial partnerships with Iran would also face isolation, effectively expanding the scope of US sanctions to secondary actors.
Tehran dismissed the comments, with the Iranian regime threatening to halt all regional oil exports if the war continues. According to Reuters, Iran has also issued a new warning to shipping vessels not to pass through the Strait of Hormuz without permission. The waterway, located south of Iran, typically handles one-fifth of the world's oil and gas, a flow that has been effectively blocked by the country since the conflict began at the end of February.
The diplomatic backdrop remains fragile following the lapse of the Islamabad Memorandum of Understanding in mid-August. The agreement, signed by Pakistan, Iran, and the US on 17 June, had established a diplomatic window that expired without extension. This follows a series of threats and diplomatic shifts by the Trump administration, including an April statement that "a whole civilisation will die tonight" unless a deal was reached, a position from which Washington later retreated after Pakistan intervened.
Bessent did not detail the specific economic measures involved in the "economic D-Day" in his column. However, he is expected to outline the specifics in a press conference in the US at 13:00 local time on Monday. The announcement comes as the US-Israel war with Iran, which commenced at the end of February, continues to strain regional stability.
The current escalation builds on a long history of sanctions. The Trump administration pulled out of the 2015 nuclear deal in 2018, reimposing sanctions, and launched a new wave of measures on foreign banks and firms doing business with Tehran in April this year.
