US, Iran exchange fire in flare-up; Bessent signals more sanctions

On August 30, 2021, U.S. forces targeted two rocket launchers on Iran's Larak Island, located in the Strait of Hormuz near Bandar Abbas. This marks the first known U.S. military strikes against Iran since late July, according to a U.S. official. The island plays a significant role in tensions surrounding Iran, maritime security, and global energy supplies due to its proximity to crucial shipping lanes at the mouth of the Gulf.

In response to the U.S. strikes, Iran launched ballistic missiles at two U.S. bases in Jordan, according to Iranian media. Jordan's armed forces intercepted eight missiles that entered its airspace, according to state television. Iran's Revolutionary Guards claimed that the attack resulted in casualties among soldiers and civilians, and vowed a response and punishment from Tehran.

U.S. Treasury Secretary Scott Bessent announced on Sunday that secondary sanctions would likely be issued weekly against Iran, with a focus initially on banks. Bessent stated that the U.S. would inform banks that it is not acceptable to have Iranian money or aid the regime. He added that the next step may involve cutting off an institution entirely from the dollar-based financial system. Bessent made these remarks ahead of a Group of 20 finance leaders meeting.

Earlier in the week, the U.S. imposed penalties on the UAE branches of Egypt's Banque Misr over alleged financial links to Iran. Bessent indicated that similar measures could be taken against other institutions in the coming weeks.