Iran has condemned US plans for a sweeping new sanctions regime, with Tehran calling the measures an assertion of Iran sanctions extraterritorial sovereignty that threatens every member of the United Nations, as the Trump administration prepares to unveil what it is calling ‘Operation Economic Outcast.’
Iranian Foreign Ministry spokesman Esmaeil Baqaei set out Tehran’s position in a post on X, arguing that the US declaration went far beyond what he termed unlawful ‘economic warfare’ against a single country. ‘It is an assertion of extraterritorial sovereignty over every independent Member State of the United Nations,’ Baqaei wrote.
The remarks came after US President Donald Trump promised what he described as ‘the most crushing economic operation ever taken against any country,’ and warned that any nation helping Tehran evade the measures would face severe financial penalties. Trump called the wider effort ‘Economic Warfare and Isolation on an unprecedented scale.’
Bessent promises the harshest coordinated isolation in history
US Treasury Secretary Scott Bessent told CNBC on Thursday that the administration’s push to crush Iran’s economy would likely negate the need for major US military operations against the country. He vowed to create ‘the greatest coordinated economic isolation in the history of the world’ against Iran, and said he would hold a news conference on Monday to spell out exactly what the package would contain.
As a preview of the approach, Bessent said the US would be telling all of its allies: ‘You are either with us or against us.’ That framing puts real pressure on countries with deep commercial ties to Tehran. According to PBS NewsHour, China, Turkey and the United Arab Emirates are Iran’s largest trade partners, precisely the relationships that the new measures are designed to squeeze.
Vice President JD Vance described economic pressure as the United States’ ‘most effective tool’ against Iran. Speaking on a podcast, Vance acknowledged the situation was ‘a delicate dance’ as both sides applied pressure to one another, but added that ‘what has been true over the last couple of weeks is they felt a lot more pressure than we have.’
The administration’s name for the package is ‘Operation Economic Outcast,’ according to NPR. The label signals Washington’s intent to push Iran to the margins of the global financial system rather than pursue military escalation.
Iran sanctions extraterritorial sovereignty row overshadows fragile MOU
The sharp rhetoric surrounds a situation that remains fluid on the ground. Shipping through the Strait of Hormuz (a chokepoint for a large share of global oil) has stayed at a fraction of levels seen before the US launched its military campaign against Iran on 28 February. Negotiations to reopen the strait have stalled, and ship-traffic data from trade intelligence firm Kpler recorded only 10 crossings on Monday and two transits on Sunday.
Iranian President Masoud Pezeshkian struck a different tone on Friday, describing a memorandum of understanding signed with the US on 17 June as a victory for Iran and saying ‘it is better to end the war today’ while Iran is ‘in a position of power and dignity,’ according to state news agency PressTV. The MOU granted Tehran a role in determining how the Strait of Hormuz would be administered through negotiations with Oman and the other Gulf states.
Iran’s parliament speaker Mohammad Baqer Qalibaf, speaking at an event in Baghdad on Friday, urged Muslim countries to make a plan to overcome what he called ‘cruel’ sanctions, according to a government summary of his comments.
Oil markets were little changed on Friday despite the political noise. Brent crude futures added 61 cents to close at $94.39 per barrel, while US West Texas Intermediate futures rose 23 cents to $87.06. Both benchmarks finished the week more than 5% higher, a move traders linked to Bessent’s comments.
One voice urged caution about how much the new measures would actually change. Helima Croft, head of global commodity strategy at RBC Capital Markets, told CNBC’s ‘Squawk on the Street’ that Iran is already one of the most sanctioned countries in the world. Croft said it is not clear whether the US will move against China and Russia, both partners of Tehran, and questioned whether additional penalties would alter Iran’s behaviour. Tehran appears to believe it can outlast the US, she said.
All eyes now turn to Bessent’s planned Monday news conference, where the full details of Operation Economic Outcast are expected to be set out.
