World mostly shrugs off Bessent’s ‘D-Day’ Iran sanctions threat

Treasury Secretary Scott Bessent declared a week of "economic onslaught" against Iran and its trading partners in a bid to end the war. However, by the end of the week, countries with ties to Tehran largely dismissed the threat, leaving analysts underwhelmed by the US actions. China, which purchases 90% of Iran's oil, responded with defiance instead of backing down.

Iranian bank branches remained operational in Dubai and Abu Dhabi. Commercial flights continued between Iran and Turkey, as well as Iran and the United Arab Emirates, which had pledged to sever all trade and financial transactions with Tehran. Routes to Thailand, Azerbaijan, Russia, and China remained unaffected. The US announced plans to sanction the UAE-based branches of Egypt’s Banque Misr, which fell short of Bessent's earlier promise of a significant sanction announcement.

Former US Treasury official and analyst Alex Zerden criticized the Treasury Department's actions, stating that they continue a long history of economic measures against Iran but do not offer a clear path to victory. The Treasury Department did not respond to a request for comment. The US faces the challenge of hitting China, which would risk retaliation and global economic fallout.

Bessent likened the US response to the 1944 D-Day landings, but the unilateral nature of the move has raised concerns about destabilizing the global financial system. The US is also reportedly engaging in "quiet diplomacy" with other countries, including the UK and G20 finance ministers. The UAE, a key US ally, stated its decision to cut financial ties with Iran was a "sovereign decision." China remains a critical question for the US, given its dominance in Iran's oil trade.