Treasury Secretary Scott Bessent announced Thursday that the U.S. would impose some of the “toughest sanctions in history” on Iran next week, doubling down on the Trump administration’s economic warfare strategy as diplomacy stalls.
In an interview with CNBC, Mr. Bessent insisted that the incoming restrictions, which Treasury would announce on Monday, would cause the Islamic republic to “collapse.”
“It is time for our allies and the rest of the world to make a decision,” he said. “We are going to squash the economy of this murderous regime.”
Mr. Bessent added that the new sanctions would likely replace the need for further kinetic action by the U.S., at least in the near future.
His comments followed a similarly worded social media post by President Trump on Wednesday. Mr. Trump said there will be an “economic D-Day” coming soon and called on the U.S.’s allies to join the effort to “isolate, and defeat, the Iran threat.”
The new sanctions come as progress toward a diplomatic solution to the Iran war has stalled. Mr. Trump said earlier this week that there are no ongoing talks between the U.S. and Iran via mediators and that the ongoing economic pressure campaign will continue until necessary.
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The U.S. is currently imposing a comprehensive naval blockade of Iran in retaliation for Tehran’s closing of the Strait of Hormuz, a narrow waterway connecting the Persian Gulf and the Gulf of Oman.
The strait, which carries at least one-fifth of the world’s annual supply of oil and natural gas, has been effectively shuttered since March, when Iran declared it closed following joint U.S. and Israeli attacks on the country.
The waterway’s closure has driven up oil and gas prices for months as commercial shipping companies remain wary of allowing their vessels to transit the strait.
Brent crude, the international benchmark for oil, stood at approximately $94 a barrel on Thursday, which is about where the price stood at the same time last month when fighting resumed between the U.S. and Iran.
The average price for a gallon of unleaded gasoline in the U.S. has also steadily risen. As of Thursday, the average price per gallon stands at about $4.10, with little movement from a month ago.
The new round of sanctions isn’t likely to move the needle on diplomacy as Iran maintains its hardline against removing its blockade on the strait, one of Washington’s key demands.
The Iranian Foreign Ministry declared on Thursday that the upcoming sanctions are a “crime against humanity” and amount to “economic terrorism.”
“The Islamic Republic of Iran remains steadfast and determined in defending its security and national interests and in confronting US military, economic, political and psychological attacks and pressures,” the ministry wrote in a statement.
Foreign Minister Abbas Araghchi also dismissed the incoming sanctions as more evidence of a failing U.S. strategy regarding Iran.
“The so-called ’Economic D-Day’ is a diversion from America’s own crisis: unprecedented debt & surging interest costs,” he wrote on X. “U.S. economic terrorism threatens the global economy and sovereignty worldwide.”
Iranian officials are currently holding negotiations with Oman to hammer out a framework agreement for future control over the Strait of Hormuz. The pending plan, which was rumored to be in the final stages weeks ago, may outline specific routes for commercial ships to take to safely transit the passage.
However, Iranian officials have said the deal itself will not open the strait, which will only happen once the U.S. accepts certain demands, including a regional ceasefire, sanctions relief and the unfreezing of assets.
The Trump administration, however, maintains that the strait must be open before any comprehensive peace agreement can be discussed.
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