Trump announces 'most crushing economic operation ever taken' against Iran

On Wednesday, US President Donald Trump declared the most severe economic operation the United States has ever imposed on any nation, following Iran's refusal to reach an agreement with Washington. Trump stated on Truth Social, "No one has given the Islamic Republic of Iran a greater opportunity to make a Deal than me." He declared that this would be "Economic Warfare and Isolation on an unprecedented scale."

Trump warned that any country permitting financial institutions, businesses, or government entities to provide any form of support to Iran would face "TREMENDOUS Economic Consequences." He listed targeted measures, including oil smuggling, swap lines, cash transfers, exchange houses, ship registries, and front companies, urging them to cease immediately.

He noted that Iran is currently "hanging by a thread," with a "destroyed military" and a "worthless" currency. Trump further stated that these historic measures would cripple Iran's ability to project terror globally.

Treasury Secretary Scott Bessent previewed the economic campaign prior to Trump's announcement, stating that the US was preparing to implement new measures amounting to "combination of economic isolation like the world has never seen before." Iran's economy is facing severe challenges, with the rial collapsing, oil production and trade plummeting, and soaring inflation.

Following a ceasefire between the US and Iran in early July, the two countries have been involved in sporadic tit-for-tat strikes, neither willing to return to full-scale war. Despite its economic predicament, Iran remains unyielding, apparently content to wait for a favorable outcome.

Since the cessation of direct hostilities, Washington has been exploring options to reopen the Strait of Hormuz, which Iran effectively closed at the beginning of the conflict in late February. However, Iran is the second-most sanctioned country in the world, with over 6,000 punitive economic measures issued against its financial, energy, and petrochemical, aviation, and cryptocurrency sectors.

The US hopes that announcing these economic consequences for countries dealing with Iran might persuade Tehran to accept a deal more favorable to Washington.