Key facts
- President Donald Trump declared Iran is "collapsing" on his social media platform.
- US Treasury Secretary Scott Bessent stated new economic measures will "collapse" the Iranian government.
- Bessent described the US strategy as the "greatest coordinated economic isolation in the history of the world."
- The US plans to apply "the toughest sanctions in history" on Iran.
- Bessent warned countries trading with Iran could face US economic penalties.
- The US and Israel began a war with Iran in February, leading to Iran closing the Strait of Hormuz.
President Donald Trump stated that Iran is "collapsing" ahead of the US government's scheduled announcement of stringent sanctions against the country. Trump posted on his social media platform, Truth Social, "IRAN IS COMPLETELY COLLAPSING!!!"
US Treasury Secretary Scott Bessent told CNBC that a new series of economic measures will "collapse" the Iranian government, describing it as the "greatest coordinated economic isolation in the history of the world." Bessent indicated that the US would apply "the toughest sanctions in history" on Iran, its adversary in a nearly six-month-long war. He warned that countries continuing to trade with Iran, whether by transferring money, buying oil, or engaging in ship transport, would face the full force of US government enforcement.
The US and Israel initiated a war with Iran in February, which Iran responded to by largely closing the Strait of Hormuz, a critical waterway for global oil and liquefied natural gas transit. This action has caused significant fluctuations in world markets. The US has made reopening the strait a key objective in ceasefire negotiations.
Bessent suggested that all countries share an interest in isolating Iran, noting that China, for example, receives 50 percent of its energy from the Gulf. He stated that conversations regarding potential penalties for countries like China would be conducted "in private."
The Trump administration also expanded sanctions against Iran and its allies by designating 10 individuals associated with Hezbollah, including a Turkish businessman accused of funneling funds to the group. Critics, however, remain skeptical about the effectiveness of decades of sanctions in achieving US foreign policy goals in Iran, such as regime change.
Details about the new economic penalties are expected to be made public at a press conference on August 24. The Iranian economy has long been struggling under international sanctions, leading to protests over the spiraling cost of living and inflation.