Bessent unveils sanctions designed to cripple Iran

Treasury Secretary Scott Bessent announced on Monday that the U.S. will impose punishing sanctions on countries and entities that do business with Iran — an attempt to bring the country to heel absent renewed military strikes.

Why it matters: The plan, dubbed an "economic D-day," is aimed at ratcheting up pressure on the Iranian regime amid the current "no war, no deal" limbo.

U.S. officials say the expanded "secondary" sanctions are expected to be the main course of action against Iran until at least after the midterm elections, when a new military campaign could again be on the table.

What he said: " Let there be no ambiguity as to the position of the United States," Bessent said at a news conference.

"An economic engagement of any kind with this murderous regime will expose those responsible to the full reach of American power." Bessent did not give a deadline for compliance, but said, "I'm not going to set a timeline, but we do not have infinite patience here." "No one is above this," Bessent said in response to a question about whether the initiative would encompass China.

"This is economic asphyxiation of this regime ... and no one should test our resolve." Yes, but: While Bessent has been conducting a PR buildup for the last 10 days over an "economic D-Day " against Iran, the reality is more complicated.

The U.S. already has significant secondary sanctions targeting countries that trade with Iran, particularly its oil sector.

But the U.S., including the current administration, has only partially enforced them.

For the new economic pressure campaign to be effective, the U.S. will need to mobilize its Western allies to form a coalition to enforce the measures against Iran.

The Trump administration will also have to aggressively confront countries like China, Russia, India, Pakistan, Qatar, Turkey and others that still trade with Iran, something it hasn't done so far.

Reality check: Iran has been under international sanctions for years, but the regime hasn't significantly changed its behavior in the region or its posture regarding its nuclear program.

State of play: The war has sunk the Iranian economy into an even deeper crisis.

Its currency, the rial, hit a new low Monday, dropping to 2 million rials to the U.S. dollar.

The current U.S. naval blockade has prevented Iran from exporting most of its oil, cutting off the lifeblood of the economy.