2 weeks ago
US Promises New 'Never-Seen-Before' Economic Measures Against Iran
The United States is in a war with Iran that started on February 28.
Now the US says it will use very strong money rules, called economic measures, that have never been used before.
The US wants to make Iran's economy so weak that it gives up.
A temporary stop to the fighting was agreed in June, but talks for lasting peace have not worked.
Because of the war and a blockade, Iran has a lot less money and much of its industry is damaged.
Some experts say more rules will not change anything, because Iran has faced them for almost 50 years.
The Strait of Hormuz is a very important sea path that many ships use to carry oil.
Two ships from the United Arab Emirates were attacked near that strait, and the UAE said it was like piracy.
Some people think economic pressure will make Iran fall, while others think it will not work.
The US also says it wants to keep oil and gasoline prices low for Americans.
US Treasury Secretary Scott Bessent said unprecedented economic measures against Iran will be announced next week.
War began Feb. 28 when the US and Israel launched airstrikes on Iran; a truce agreed in June has failed to secure lasting peace.
Iran's economy is badly damaged by sanctions and a naval blockade, but Bloomberg Economics doubts more sanctions will break Tehran's will.
Two Abu Dhabi National Oil Co. vessels were attacked in the Strait of Hormuz on Thursday; the UAE called the strike 'acts of piracy.'
Brent crude rose as much as 1.9% to almost $88.69 a barrel on Friday, with weekly gains exceeding 5%.
- Who
- The United States, President Donald Trump, Treasury Secretary Scott Bessent, Israel, and Iran are the central parties.
- What
- The US promised economic measures 'never seen in the history of economic isolation' on Iran, part of a 'one-two punch' with the blockade of Iran's ports.
- Where
- The Middle East, centered on Iran, Israel, the Persian Gulf, and the Strait of Hormuz.
- When
- New announcements were promised for next week after Bessent's Thursday interview; the war began Feb. 28 and a truce was agreed in June.
- Why
- To force Tehran's capitulation and end the conflict while keeping oil and gasoline prices cheap for Americans, according to officials.
Sanctions Skeptics
Pressure Advocates
Can economic pressure force Iran's capitulation?
Sanctions Skeptics
Bloomberg Economics says 47 years of sanctions have not broken Tehran's will, so more of the same is unlikely to produce changes.
Pressure Advocates
Israeli officials including Finance Minister Bezalel Smotrich say Iran's economic weakening, the embargo and sanctions can bring down the regime, and the current pressure situation is 'best for us.'
Military escalation vs. economic 'low-key' pressure
Sanctions Skeptics
Trump says he is 'low-keying it' with Iran and watching its inflation, wary of expanding a military campaign amid domestic opposition and munitions shortfalls.
Pressure Advocates
Prime Minister Benjamin Netanyahu says Israel is poised to resume attacks on Iran if asked by the US, as strident threats are used to push Tehran into talks.
Key facts
- Announcement
- Never-seen-before economic isolation measures against Iran, expected next week per Treasury Secretary Scott Bessent
- War started
- Feb. 28, when the US and Israel launched airstrikes on Iran
- Truce
- Agreed in June; talks for lasting peace have stalled
- Sanctions added since 2018
- About 2,200 on Iran, according to Jeremy Paner of Hughes Hubbard & Reed
- Hormuz transit share
- One-fifth of the world's oil and gas transited the strait before the war
- Thursday attacks
- Two Abu Dhabi National Oil Co. vessels attacked in Hormuz; a tanker struck by a drone with minor damage and crew safe
- Brent crude
- Rose up to 1.9% to almost $88.69 a barrel on Friday; weekly gains over 5%
Quotes
Vice President J.D. Vance
United States Vice President
“Watch this space for more announcements coming next week because we are going to apply measures like have never been seen in the history of economic isolation on a country”
livemint.com
“We are just watching Iran with its huge inflation and the fact they have no money”
livemint.com
Sources
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