US declares global economic war on Iran, vowing to sever all revenue streams

The United States has launched an unprecedented global economic campaign against Iran, with Treasury Secretary Scott Bessent announcing on Monday that Washington will target all sources of Iranian revenue, including oil, in an effort to isolate Tehran financially.

"Around the globe, our objective is to sever every economic lifeline that sustains this tyrannical regime until Tehran stands alone," Bessent said, warning what he called Iran's facilitators to cease buying oil and doing business with the Islamic Republic Source: Al Jazeera.

The announcement marks a dramatic escalation of the Trump administration's "maximum pressure" campaign, first imposed during Trump's first term in 2018 after the US unilaterally withdrew from the nuclear deal between Iran and world powers. That deal had lifted UN sanctions in return for verified curbs on Iran's nuclear programme Source: Al Jazeera.

Analysts say the new penalties are unlikely to change Iran's behaviour, already one of the most sanctioned countries in the world. Banks, oil buyers and refiners, shipping companies, registries, ports, airports, exchange houses, front companies and potentially governments facilitating Iranian trade could be exposed to secondary sanctions by Washington Source: Al Jazeera.

Iran has responded to previous US and allied economic pressure with a complex sanctions-evasion system, including a shadow tanker fleet, ship-to-ship transfers of oil, shell companies, and alternative payment and barter mechanisms. A naval blockade enforced by the US military has physically stopped most Iran-linked ships from transiting through the country's southern ports. The US Central Command said on Sunday that its forces have redirected 70 commercial vessels, disabled three, and boarded two as part of the blockade, which it says could last indefinitely. But Iran's extensive land borders, railway lines, and access to the Caspian Sea in the north give Tehran additional leeway Source: Al Jazeera.

The economic war comes as US public support for the military campaign against Iran is waning. A Reuters/Ipsos poll released Monday found that just 31 percent of Americans surveyed support US military action against Iran, down from 37 percent in March. Support among Republican respondents fell to 69 percent, compared with 77 percent in March Source: Al Jazeera.

Trump's approval rating remains at a record low of 33 percent for the second consecutive Reuters/Ipsos survey, matching the lowest approval rating recorded across his first and second terms. The economic effects of the war are a major concern for Americans: Iran has maintained a de facto blockade of oil exports from the region, contributing to a rise in US petrol prices to near record highs Source: Al Jazeera.

The financial squeeze on Tehran is also affecting US military commitments elsewhere. South Korea announced Monday that the US has cancelled a large joint amphibious landing exercise scheduled for next month due to constraints on force availability caused by the US-Israel war on Iran. The biennial Ssangyong drills, involving marine forces from South Korea and the US, were called off after the US Marine Corps formally notified South Korean forces in June that its ability to deploy forces would be constrained due to the situation in the Middle East Source: Al Jazeera.

Trump has also ordered a separate annual joint military exercise with South Korea, the Ulchi Freedom Shield drills, to be cut from 11 days to five, citing cost and Seoul's refusal to take part in the war on Iran Source: Al Jazeera.

The strategic implications are clear: the US is concentrating its military and economic resources on Iran, but the campaign is straining alliances and exposing vulnerabilities in the global financial system's ability to enforce sanctions. European banks, for instance, have come under scrutiny for failing to meet their own climate pledges while continuing to finance oil and gas companies that operate in Iran's orbit. A recent investigation by Follow the Money found that ING, the Amsterdam-based bank, helped fund three pure-play oil and gas producers—Norway's Aker BP and Vår Energi and the UK's NEO Energy—through 2025 and into 2026, arranging more than $900 million in loans and bonds for them despite a 2024 pledge to halt new financing to companies opening new fields Source: DutchNews.nl.

Trump has described the coming financial measures as an "economic D-Day," with the US preparing the most potent financial measures ever imposed against any country Source: Al Jazeera. But the success of the campaign will depend on whether other nations comply with US demands to stop buying Iranian oil and doing business with Tehran—and whether Iran's evasion networks can withstand the pressure.