The Trump administration is preparing a sweeping escalation of economic pressure against Iran, threatening what Treasury Secretary Scott Bessent described as the "financial equivalent" of a bombing campaign, as a fragile ceasefire between the two countries approaches its expiry date. Speaking at a White House briefing, Bessent warned that the United States is ready to impose secondary sanctions — penalties targeting not only Iran directly, but also any companies, banks, or countries that continue doing business with Tehran, including close partners such as the United Arab Emirates and rival powers such as China.
The Treasury Department has already sent warning letters to financial institutions in China, Hong Kong, the UAE, and Oman, accusing them of allowing Iranian illicit financial flows through their systems. Bessent confirmed that two Chinese banks have received specific warnings about handling Iranian money — a particularly sensitive move ahead of a planned visit by President Donald Trump to Beijing for talks with Chinese President Xi Jinping. On Wednesday, Washington also imposed fresh sanctions on an oil-smuggling network linked to Ali Shamkhani, a deceased senior Iranian security official and former close adviser to Iran's supreme leader, targeting dozens of individuals, companies, and vessels operating through front companies, many based in the UAE.
The broader strategy reflects a belief inside the administration that Iran's military and economic position has significantly weakened following a sustained bombardment that caused tens of billions of dollars in damage to the country's infrastructure, including its oil industry. Deputy chief of staff Stephen Miller claimed Trump had "played the checkmate move" by implementing a naval blockade of Iranian ports in the Strait of Hormuz — the narrow waterway between the Persian Gulf and the Gulf of Oman through which a significant share of global oil passes. Vice President JD Vance said Trump was seeking a "grand bargain" offering Iran economic prosperity in exchange for a commitment to abandon nuclear weapons. Privately, advisers argue that if Iran cannot pay its internal loyalists, economic pain could force Tehran back to the negotiating table.
Yet the strategy faces significant scepticism. Democratic Senator Elizabeth Warren argued that the ongoing blockade and rising oil prices were paradoxically boosting Iranian revenues, effectively offsetting the impact of new sanctions. Sanctions attorney Daniel Pickard warned that secondary sanctions risk "diplomatic and economic blowback" from allies already critical of the conflict. Some Republican senators expressed doubt that further economic pressure would change Iranian behaviour without regime change. Meanwhile, talks between the two sides are expected to reconvene in Islamabad, Pakistan, where negotiators face deep disagreements over the duration of any uranium enrichment suspension — Tehran has resisted American demands for a permanent ban — as well as over the disposal of Iran's existing stockpile of highly enriched uranium and the scope of sanctions relief.
Analysts note that any deal will need to clear a high political bar for Trump: it must be demonstrably stronger than the 2015 nuclear agreement, known as the JCPOA, which Obama signed and Trump abandoned in 2018, and better than the terms reportedly on offer in earlier talks held in Geneva in February. The path is narrow. Iran remains internally divided between factions favouring a confrontational approach and those who see the Strait of Hormuz as a negotiating lever to be cashed in for lasting security and economic guarantees. As one Iran-based international lawyer put it, Tehran faces its own version of the "marshmallow test" — choosing between the temptation of immediate leverage and the longer-term gains a negotiated settlement could bring.