Trump is counting on economic pressure to force Iran to capitulate, but will it work?

President Donald Trump is employing economic pressure as a tactic to compel Iran to surrender, but the efficacy of this approach remains uncertain. The US has implemented a naval blockade that has halted crude exports from Iran's primary oil terminal at Kharg Island, with all three terminals currently idle. Additionally, 55 commercial vessels have been redirected by American forces.

Trump claims that Iran is facing "very bad shape" economically and is unable to pay its troops. This economic predicament follows a week in which Trump threatened Iran with what he termed "the biggest attack since World War II." However, it is uncertain whether economic pressure can force Iran to compromise, as military action has thus far failed to achieve Washington's primary political objective.

Vali Nasr, an Iran analyst, suggests that Trump is preparing for an exit from the conflict. Aaron David Miller, a former US Middle East negotiator, believes that this approach is likely the least damaging of Trump's available options, although it may not be successful. The US and Israel launched a war against Iran on February 28 with the goal of removing its rulers, but Tehran has since solidified its stance in negotiations over a lasting peace.

A ceasefire took effect on April 8, and since then, Trump has oscillated between threats of renewed military action and attempts at negotiation. Currently, Washington is maintaining the pressure without immediately escalating the war. Economic pressure is already having an impact, as evidenced by the complete halt of Iran's crude export pipeline at Kharg Island, the country's main oil export hub.

All three Kharg terminals are empty, with the western terminal inactive for 22 consecutive days and the LPG and eastern terminals also idle. Seventeen tankers remain stationary in the waiting area, described as a "dark queue that isn't moving." The US military has redirected 55 commercial vessels, disabling two and boarding two others.

This economic squeeze is hitting an economy already weakened by years of sanctions. Masoud Nili, a prominent Iranian economist, describes the country as being at a historic crossroads, with the exchange rate increasing nearly 50-fold and food prices rising over 34-fold since 2018. About 16 million people have fallen below the poverty line, and the jobless rate is around 9.4%, with six in 10 individuals not participating in the labor market.

Young and jobless, the working-age population has grown by about five million since 2019, while net employment has only increased by 400,000. People in their 20s make up the largest share of both the inactive and unemployed populations. The situation is particularly dire for women, with the working-age female population increasing by 2.6 million but female employment falling by approximately 700,000.

Additionally, Iran has lost around 630,000 industrial jobs between spring 2025 and spring 2026, erasing employment gains accumulated over the previous eight years. However, it remains unclear whether economic pain will lead to political change. Omid Memarian, a senior Iran analyst at the democracy and human rights organization DAWN, notes that the timing could be crucial.

While Iran has been economically isolated for some time, it is uncertain whether the country will collapse within six months or a year. Memarian suggests that the war has temporarily helped the regime withstand economic pressure by generating nationalism and allowing Tehran to maintain its "repression machinery at the highest level possible."

However, he believes that the war has also temporarily concealed divisions within Iran's leadership. Once the war is settled, Iran will face an "ocean of expectations," but it lacks the resources to meet these demands, potentially bringing people back onto the streets and exposing leadership rifts. Hardliners in Iran seem to believe that Trump cannot sustain the confrontation beyond the next few months and are hoping for him to eventually release Iranian assets, remove sanctions, and offer security guarantees.

For Trump, the gamble is that Iran's economic crisis will eventually achieve what military threats have not. If inflation, unemployment, and lost oil revenue compel Tehran towards a deal, Trump can claim that pressure worked without initiating another devastating attack. However, economic pressure could also strengthen hardliners, particularly if Iran perceives Washington as constrained by military stockpile pressures, the upcoming US elections, and the economic risks of prolonged disruption in the Strait of Hormuz. The longer the blockade persists, the greater these risks become.