U.S. blockade, sanctions crippling Iran's economy, Treasury report says
The U.S. naval blockade, sweeping economic sanctions and obstruction of overland export routes have crippled Iran's economy and intensified pressure on the regime, according to a new Treasury Department report obtained by Axios. Why it matters: Treasury Secretary Scott Bessent, who is leading an economic pressure campaign dubbed "Operation Economic Outcast," is one of Trump's closest aides urging…
A new Treasury Department report reveals that U.S. naval blockade and stringent sanctions are severely damaging Iran's economy, according to Axios. Treasury Secretary Scott Bessent, leading the economic pressure campaign named "Operation Economic Outcast," urges President Trump to allow the initiative to continue rather than rush into further military action.
While the report does not suggest the Iranian regime is nearing collapse, it outlines the Treasury's belief that these efforts have significantly crippled Iran's economy and limited its revenue generation capabilities.
Trump is employing a dual strategy, attempting to restart peace talks while simultaneously preparing for potential resumption of major combat operations following the midterm elections. The Treasury campaign, launched in late August, serves as a third approach to weakening Iran's situation. However, U.S. officials believe the campaign needs more time to destabilize the regime and convince Iranian leadership to make concessions at the negotiation table.
On Thursday, Trump convened a meeting with his top national security and foreign policy aides to discuss the ongoing war. U.S. Central Command chief Adm. Brad Cooper briefed President Trump on the naval blockade, and Bessent explained the economic pressure campaign. Bessent claims to the President that the economic pressure campaign is effective and that conditions in Iran are deteriorating, which could potentially push Supreme Leader to agree to a deal, according to a U.S. official.
The Treasury report underscores several aspects of Iran's economic crisis. The Iranian rial has lost about a quarter of its value since the operation began in August, with the unofficial exchange rate reaching a record low of 2.687 million rials to the dollar in October. Inflation has surged to 90% in September, up from roughly 35% in early 2025.
Iran has ceased loading oil onto tankers since August 25 due to the blockade and sanctions, and has also offloaded remaining oil stranded at sea, as reported by Kpler, a maritime trade tracker.
Written by urgent.news from Axios's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
