The United States is preparing an expansion of economic pressure on Iran, with Treasury Secretary Scott Bessent promising what he described as the toughest sanctions ever imposed on the country. The campaign is intended to restrict Iran’s oil sales, financial transactions and access to trade while increasing pressure on governments and companies that continue doing business with Tehran.
Bessent said Thursday that the strategy would combine economic restrictions with the U.S. blockade. He said the administration expects the pressure to weaken Iran’s ability to finance military operations and groups aligned with Tehran. The Treasury secretary said he plans to hold a press conference Monday, August 24, to explain the measures Washington intends to take.
The announcement puts China at the center of the new U.S. strategy.
China purchased more than 80% of Iran’s shipped oil in 2025, based on data from energy analytics firm Kpler cited by Reuters. Much of that crude has been purchased by independent Chinese refineries, often called “teapot” refiners, that have played a role in keeping Iranian oil exports moving despite years of U.S. restrictions.
Bessent urged Beijing to cooperate with Washington, arguing that China also has an interest in restoring stable energy traffic through the Persian Gulf. He said China receives about half of its energy from inside the Gulf and would benefit from lower prices and reliable shipping. When asked whether Washington could target China for continuing to trade with Iran, Bessent said some discussions were better handled privately.
President Donald Trump has also warned countries against providing Iran with an economic lifeline. He threatened economic consequences for governments, businesses, banks, airports and organizations that help Tehran maintain access to international commerce. The warning raises the possibility that the administration could rely heavily on secondary sanctions, which punish foreign entities for transactions with sanctioned Iranian interests.
The Associated Press reported that Iran rejected the threats. Iranian Foreign Minister Abbas Araghchi described the pressure campaign as another failed U.S. policy and argued that Washington was trying to distract attention from economic problems at home. Tehran has endured American sanctions for decades and has developed networks designed to move oil, money and goods outside financial channels.
Washington has spent months expanding restrictions on those networks. The Treasury Department has targeted Iranian oil shipments, shipping companies, front businesses, financial intermediaries and entities linked to the Islamic Revolutionary Guard Corps. Earlier actions under the administration’s “Economic Fury” campaign also targeted Chinese companies accused of buying or helping transport Iranian petroleum.
One major focus has been China’s independent refinery sector. Treasury previously sanctioned Hengli Petrochemical’s Dalian refinery, describing it as one of Iran’s largest customers for crude oil and petroleum products. That action also targeted dozens of shipping companies and vessels accused of helping move Iranian oil. U.S. officials have separately warned financial institutions about the sanctions risks connected to Chinese refiners handling Iranian crude.
The next step could be much broader. Reporting indicated that options considered by U.S. officials include additional sanctions against Chinese teapot refineries and possibly financial institutions involved in processing Iranian funds. Larger Chinese banks would present a more complicated target because penalties against them could disrupt trade far beyond Iran and provoke retaliation from Beijing.
That risk makes China both the most important target and the most difficult part of the strategy. Cutting Iranian exports without reducing Chinese purchases would leave Tehran with a major source of revenue. But aggressive sanctions against major Chinese institutions could create another confrontation between Washington and Beijing at a time when the two countries remain closely linked through trade, manufacturing and supplies of important materials.
The pressure campaign is also closely tied to the Strait of Hormuz. The waterway remains one of the world’s most important energy routes, and disruptions there have already reduced shipping and raised concern about global petroleum supplies. Bessent argued that stronger economic pressure could reduce the likelihood of another large-scale round of military action, although the administration has not ruled out the use of force.
Oil markets reacted.
Brent crude settled Thursday at $93.78 a barrel, while U.S. West Texas Intermediate crude settled at $87.83, market data showed. Both benchmarks rose more than 2% as traders considered the possibility that tighter sanctions or renewed confrontation could further restrict supplies. Bessent said he believed markets were misreading the administration’s approach because stronger sanctions could make another major military escalation less likely.
The sanctions push follows nearly six months of conflict involving the United States, Israel and Iran. Efforts to reach a lasting settlement have repeatedly stalled, while attacks and restrictions around the Strait of Hormuz have added pressure to energy markets. Washington is now presenting economic isolation as a central tool for forcing Tehran to change course.
The effectiveness of the strategy may depend less on sanctions announced in Washington than on enforcement outside the United States. Iran has repeatedly adapted to restrictions through front companies, alternative payment systems, ship-to-ship transfers and vessels operating through opaque ownership structures. Each new restriction can force those networks to change, but shutting them down entirely has proved difficult.
The administration is therefore signaling that companies and countries helping Iran could themselves become targets. That approach could significantly increase the cost of dealing with Tehran, particularly for businesses that need access to U.S. banks, markets or dollar transactions. It could be less effective against companies with little exposure to the American financial system.
For now, the most important details remain undisclosed. Bessent’s Monday press conference is expected to show whether the administration plans a targeted expansion of existing measures or a broader effort to penalize foreign companies, banks and governments that maintain economic ties with Iran.
Whatever form the measures take, China will be central to their impact. As long as Beijing remains the dominant buyer of Iranian oil, Washington’s attempt to sharply reduce Tehran’s export revenue will depend on whether Chinese refiners, banks and officials decide that the cost of continuing the trade has become too high.
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