US Treasury Secretary: Sanctions to 'squash' Iran's economy and 'collapse' regime

US Treasury Secretary Scott Bessent has called on international allies to support Washington's strategy to "squash" Iran's economy and "collapse" its regime through unprecedented economic isolation. Bessent told CNBC that the planned pressure campaign would minimize the need for a large-scale military conflict, stating, "You are either with us or against us." He warned that any entities continuing to do business with Iran, such as transferring money or buying its oil, would face the full force of US Treasury enforcement.

Details on the new economic penalties are expected to be revealed at a press conference on August 24. The US and Israel initiated a conflict with Iran in February, citing concerns over nuclear weapons development, which Tehran denies. Iran responded with attacks on Israel and US bases, and largely closed the Strait of Hormuz, a critical waterway for global oil and LNG transit, leading to market volatility. Despite previous ceasefires and stalled negotiations, the US is preparing what Bessent described as "the greatest co-ordinated economic isolation in the history of the world."

However, some Iranian residents expressed skepticism about the effectiveness of further sanctions. They noted that the country has a long history of living under international sanctions and has become accustomed to such pressures, suggesting that while the economy might weaken, a collapse of the regime is unlikely. One resident told the BBC that Iran has overcome crises before and will likely find ways to continue trading.