Washington is launching its biggest financial attack yet to cut Iran off from the world. But with China still buying its oil and the Strait of Hormuz still blocked, the real pain is just hitting regular people at the gas pump.
When bombs and blockades do not force a surrender, the next weapon is the wallet. The United States tried to drop a financial bomb on Iran, but Tehran is acting like it saw it coming.
Treasury Secretary Scott Bessent dropped the hammer on Monday, announcing what he called “Operation Economic Outcast.” He described it as the single greatest financial offensive ever launched against Iran, aiming to “tighten the noose and block every potential source of revenue.”
Bessent warned the rest of the world to pick a side. He said any bank, business, or country doing business with Tehran would share its isolation, adding that they could not “claim they are blind to enabling this activity.” President Trump is reportedly planning to call world leaders directly to demand they cut ties.
But Iran is not blinking.
Economy Minister Ali Madanizadeh went on state television and said Tehran is “fully prepared.” He claimed the government has a two-year plan to manage the fallout and has actually been waiting for the US to make this move.
“We also have our own tools and know how to play the game,” Madanizadeh said.
The biggest hole in the American plan is China. About 90% of Iran’s oil goes straight to Beijing. China’s foreign ministry immediately pushed back, calling the US move “illegal unilateral sanctions” and promising to protect its own interests.
Because of that, some experts think the US threats are mostly noise. David Oxley, an economist at Capital Economics, called the new package a “damp squib.” He pointed out that China has ignored US sanctions on Iran for years and is highly unlikely to stop now just because Washington yells louder.
While the politicians play chicken, the real world is paying the price.
SEE ALSO: Trump Promised Tougher Economic Sanctions on Iran and Any Country Helping Them
The US-Iran conflict started in February. In response, Iran effectively choked off the Strait of Hormuz, a narrow waterway where a fifth of the world’s oil and gas normally flows. Because of that blockade, global oil prices have spiked. Brent crude is sitting at $92 a barrel.
In the US, gasoline has blown past $4 a gallon. With midterm elections coming up in November, voters are feeling the pinch every time they fill up their tanks. The Treasury even tried to buy back government debt last week to calm the markets, but borrowing costs just bounced right back up.
The US is threatening to cut off the money. Iran is threatening to shut down the rest of the region’s oil exports if the war keeps going. The diplomats are talking tough, but out on the water, the oil tankers are still stuck.
