Aug. 24, 2026, 5:01 p.m. ET
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Washington
As military costs mount in a nearly six-month stalemate with Iran, President Donald Trump is taking a new route: economic warfare.
In a news conference on Monday afternoon, Treasury Secretary Scott Bessent announced Operation Economic Outcast, a “zero leakage” crackdown on Iranian oil smuggling and sanctions evasion. Mr. Bessent described an unprecedented effort to isolate Iran from the global economy, threatening crippling sanctions against countries that do business with Iran.
But the secretary also said the United States would not impose these secondary sanctions right away, instead giving each country a timeline to shut down their Iran-related activity and calling the operation a “warning shot.”
Iran is one of the most heavily sanctioned countries in the world. But the Trump administration hopes it can turn up the pressure even more, threatening nations that do business with Tehran.
Iran is already one of the most heavily sanctioned countries in the world. But the Trump administration believes it can turn up the economic pressure even more – and is hoping that pressure, combined with the steep costs of the war and related social disruption, could create a scenario in which Tehran is finally ready to fold.
In a Truth Social post last week, Mr. Trump said that the new economic pressure – dubbed “Economic D-Day” – would be “the most crushing economic operation ever taken against any country.”
However, Monday’s announcement did not include any specific penalties against China, which is the largest buyer of Iranian oil. Mr. Bessent declined to name which countries the U.S. would target under this operation or answer questions about China. Many experts had expected the U.S. might target large Chinese banks that do business with Iran.
Richard Nephew, a fellow at the Washington Institute for Near East Policy, who served as deputy special envoy for Iran in 2021, says he might take the operation seriously if the administration later announced such a step. But until then, he said the announcement was more talk than action.
“They’re just attempting to put a positive spin on what is effectively a status quo set of measures,” he said.
Iran declared on Sunday that it is not afraid.
“All of their actions – whether blockades or other military moves they have made – have failed, and this new issue of theirs will fail as well,” said Iranian Foreign Minister Abbas Araghchi in a video posted on Telegram.
Experts point out that the threat of economic penalty is nothing new for Iran. Mr. Nephew says the U.S. has imposed a range of sanctions on Iran over the past 30 years, gradually moving from targeting specific goods or activities to punishing entire sectors of its economy – to the extent where it’s difficult to pin down any sectors that remain untouched.
“What you’re really down to is [Mr. Trump] filling in the cracks of an existing sanctions regime that is already pretty broad and pretty deep,” he says.
One new tactic is to take a harsher stance toward countries that do business with Iran. The administration hopes that by pressuring countries to cut economic ties with Iran – and penalizing those that don’t with sanctions – they can isolate the country and force it into cooperation.
