The United States announced a new economic pressure campaign against Iran on Monday, warning that penalties would target countries and companies that keep doing business with Tehran. Treasury Secretary Scott Bessent said the new U.S. secondary sanctions in the pipeline aim to block all potential sources of revenue for Iran and that nations should cut economic ties to Tehran or face U.S. retaliation.
Who Holds the Levers
Bessent made the hierarchy plain. "Let there be no ambiguity as to the position of the United States. An economic engagement of any kind with this murderous regime will expose those responsible to the full reach of American power," he said. He also said it was "no longer acceptable to operate in the gray spaces" of the Iran conflict and added, "Secondary sanctions are a very powerful tool."
That tool landed Monday on nearly 60 Iran-linked entities, according to the Treasury. The department said the targets were tied to Iran's nuclear and missile programs, malign cyber activities and oil shipments. A sanctioned company is cut off from the U.S. financial system. That’s the apparatus speaking in the language of exclusion.
The Treasury sanctioned Hong Kong-based Sweet Ocean Industrial Limited and its associated personnel and businesses, accusing them of helping Iran acquire sensitive goods such as laser optics equipment. It also sanctioned several other Hong Kong-based entities for having provided funds to Sweet Ocean and its network. Separately, the Treasury sanctioned China-based Shenzhen Huamei, the Hong Kong branch of the Iran-based logistics company BRE Line and its director for their ties with BRE Line in support of Iran's missile and nuclear programs.
Who Pays for the Pressure
Bessent said the administration's economic campaign includes warnings to other countries not to do business with Iran in sectors such as shipping, technology and aviation. He said China, Turkey and the United Arab Emirates are Iran's largest trade partners, though he did not name the countries that could face potential secondary sanctions.
The move came as Iran's parliament speaker Mohammad Bagher Qalibaf dismissed the impact of looming U.S. sanctions. Qalibaf said Iran's trading partners were not taking Washington's "statements into account," and wrote on X that "Americans know that no one buys their bombast" and that the United States was "not in an economic position to further restrict its relations with other countries."
Iranian Foreign Ministry spokesperson Esmail Baghaei said in Tehran on Monday that "any escalation of this situation will undoubtedly bring about consequences ... Our hands are not tied." China also pushed back, with Foreign Ministry spokesperson Lin Jian saying in Beijing that the sanctions would "only exacerbate tensions and escalate the situation, which is in no one’s interest." He added that China was calling on all parties to avoid measures "that could further intensify differences and conflicts and disrupt global economic development and financial stability."
The people at the bottom of this squeeze are the ones already paying. Iran's currency hit a record low Monday as Washington prepared to announce new sanctions. The rial dropped to 2.02 million to the U.S. dollar as trading opened on currency markets. Iran's official Central Bank rate stood at around 1.5 million rial to the dollar, but the market rate is what most Iranians pay.
The Cost Hits Ordinary People First
The currency had already been under pressure before the U.S. and Israel attacked Iran on Feb. 28, as Iran faced double-digit inflation and negative growth, but has repeatedly hit new lows as nearly six months of war have taken an even greater toll. Iranians find daily staples increasingly unaffordable. Since the war began, rice is up some 60% and prices of beef are more than 150% higher. The International Monetary Fund forecasts that GDP will contract more than 5%.
Bessent wrote Sunday in an opinion piece in the Financial Times that "President Trump decimated Iran’s economy to a point where the rial has never been weaker and inflation has rarely been higher." He said, "The regime’s final refuge now lies in the self-deception of fearful nations that still believe accommodating aggression can secure a durable peace."
The sanctions campaign also reaches outward, pressing other states to police their own trade routes and financial systems on Washington’s behalf. The United Arab Emirates announced last week that it was suspending all trade, commercial exchanges, and financial transactions with Iran until further notice. The UAE has long been one of Iran's largest trading partners and its biggest source of imports. Reuters also reported that the UAE moved to suspend all trade and financial transactions with Iran after two ballistic missiles were fired toward Emirati territory, one of which targeted UAE-owned tankers.
China remains the biggest buyer of Iranian oil and serves as a crucial link to the global economy for Tehran, accounting for about 90% of its oil exports, according to the U.S. government. China reported $9.96 billion in bilateral trade with Iran in 2025, excluding roughly $31.2 billion in unreported Iranian crude oil exports to China that year, according to the U.S.-China Economic and Security Review Commission. Independent Chinese refiners take in the bulk of it, often rebranded as Malaysian or Indonesian crude and settled through intermediaries outside the dollar system, according to Kpler. The U.S. Treasury has sanctioned several of those refineries this year for Iranian oil purchases, while sparing Chinese financial institutions.
Turkey maintains significant commercial ties with Tehran, importing Iranian natural gas and exporting manufactured goods south. Turkey-Iran bilateral trade reached $5.7 billion in 2024, according to the Turkish Ministry of Foreign Affairs, with Ankara exporting mostly machinery and parts, chemical and agricultural products, while importing energy products from Tehran. Under a 25-year gas supply contract between the two countries that expired at the end of July, Turkey's imports of Iranian gas spiked this year while Iran's share of Turkey's total natural gas imports rose to 18.6%, according to local media.
Iraq, dependent on Iranian electricity and gas, renewed a five-year contract in March 2024 to supply Iraq with up to nearly 660 billion cubic feet of natural gas a year, and electricity imports from Iran accounted for more than 30% of its electricity generation in 2023, according to the U.S. Energy Information Administration. Iraq-Iran trade reached more than $10 billion in 2025, according to Reuters, with Tehran exporting food, consumer goods and other products to the Iraqi market. Iraq reportedly pays Iran around $4 billion to $5 billion a year for natural gas for electricity generation.
India, among Iran's top five trading partners, saw its bilateral trade with Iran fall in recent years to around $1.6 billion in the year ending March 2026, down from $2.3 billion in the year through March 2023. India primarily exports rice, tea, sugar and pharmaceuticals to Iran, and imports dry and fresh fruits from Iran. In April, India resumed importing crude oil from Iran following a seven-year halt, after the U.S. temporarily lifted sanctions on Iranian crude exports. Reuters said those trades now will be tested if Washington makes good on its threat to sanction any entity, including Indian refiners, that have procured Iranian energy.
The sanctions keep widening. The pressure keeps moving downward. And the people who have to buy rice, beef, fuel, and electricity are the ones left to absorb the shock while governments and treasuries trade threats across borders.