Key facts
- The US has launched 'Operation Economic Outcast,' expanding sanctions against Iran to include gold, digital assets, aviation, shipping, and tech sectors.
- US Treasury Secretary Scott Bessent warned that countries continuing to trade with Iran risk being cut off from the dollar-based financial system.
- The US Treasury Department sanctioned 60 entities, individuals, and vessels and suspended several general licenses.
- Iran's economy is reportedly struggling with rising prices and gas lines, with oil exports falling to zero.
- The UAE, a major trading partner, suspended all commercial and financial transactions with Iran.
- Iranian officials have threatened retaliation, including targeting oil exports and shipping routes, if regional neighbors align with the US sanctions.
The United States has intensified its economic pressure on Iran with the launch of 'Operation Economic Outcast,' a broad sanctions initiative targeting sectors beyond oil, including gold, digital assets, aviation, shipping, and technology. US Treasury Secretary Scott Bessent announced the measures, warning that countries and businesses continuing to trade with Iran risk being disconnected from the dollar-based financial system.
The sanctions come after a 60-day window for negotiating a US-Iran peace deal and reopening the Strait of Hormuz expired. The US Treasury Department has sanctioned 60 entities, individuals, and vessels, and suspended several general licenses, while working with partners to disrupt illicit revenue networks.
Iran has adopted a confident stance, asserting that its trading partners will resist US pressure and that the country is prepared for the punitive measures. Key trading partners like China, Iraq, Pakistan, Turkey, and some Gulf states have historically maintained commercial ties with Tehran. Data from 2025 indicates China purchased over 80 percent of Iran's shipped oil, though Chinese financial institutions facilitating this trade were not directly targeted in the latest sanctions.
Despite official assurances, ordinary Iranians are likely to experience the impact of the sanctions, with reports of gas lines, rising prices, and a significant gap between petrol supply and demand. The Central Bank governor stated that Iranian oil exports have fallen to zero amid a US naval blockade, exacerbating the country's economic crisis.
Iranian officials have issued threats of retaliation, including targeting US oil and economic companies and potentially blocking oil exports from the Persian Gulf and Strait of Hormuz if regional neighbors align with the US. This creates a dynamic where the US seeks to isolate Iran economically, while Iran attempts to regionalize the costs of that isolation.
In a significant development, the United Arab Emirates, a major trading partner and re-export hub for Iran, announced the suspension of all commercial and financial transactions with Tehran, citing 'regional escalation.' This move, with an estimated $20 billion in annual bilateral trade, could signal a more lasting Emirati pivot away from the Islamic Republic, though its implementation may depend on Iran's behavior regarding shipping in the Strait of Hormuz.