Almost six months have passed since Donald Trump promised to win a quick victory over Iran, but the conflict has reached a stalemate, and the prospects for a military victory, as well as a diplomatic agreement, are looking increasingly distant.
Trying to find a way out, Trump promised an “economic D-Day” [a reference to the landing of anti-Hitler coalition troops in France in 1944 - Ed.], that is, new sanctions, as a result of which any country doing business with Iran would face “huge” economic consequences.
However, Iran has been living under sanctions for a very long time. As the conflict unfolds, the country has demonstrated a willingness to endure—as well as an ability to adapt in the face of incredibly powerful economic and military pressure.
Now the main question arises for the United States: will new sanctions be able to turn the tide if the previous strategy did not lead to success?
What exactly is Washington planning?
It remains unclear what exactly the mechanism for new economic pressure on Iran will be. US Treasury Secretary Scott Bessent promises to talk about the details at a press conference on August 24.
However, in an interview with CNBC, Bessent said that Washington will punish any country - ally or adversary of the United States - that, in his opinion, is helping Iran survive the conflict.
“Whoever is not with us is against us,” he said. “If you want to do business with Iran—transferring money, buying oil from them, or shipping them, the US Treasury and the US government will use all their might and power against you.”
US Vice President J.D. Vance described sanctions as a “new phase” of the conflict in which economic pressure would be the “most effective” tool available to Washington.
“They're going to try to put economic pressure on us, but in the last few weeks it turns out they've felt a lot more pressure than we have,” Vance said on The Clay Travis and Buck Sexson Show.
“We will continue this because we believe this is the best way to achieve our ultimate goal,” he added.
"Economic Rage"
The United States has imposed significant economic sanctions against Iran almost from the very beginning of the Islamic Republic, which emerged in 1979.
The first Trump administration increased pressure on Tehran in 2015 when it withdrew from the world powers' previous nuclear deal with Iran, the Joint Comprehensive Plan of Action (JCPOA).
And in the current conflict, the US government has already announced “Operation Economic Fury”: a two-pronged campaign that combines Treasury-coordinated sanctions against Tehran’s finances and a naval blockade of Iranian ports.
Washington Atlantic Council expert and former US Defense Department adviser Imran Bayoumi told the BBC that the current measures were likely driven by growing dissatisfaction with the fact that all previous efforts had failed to produce the results Trump wanted.
“It's really an admission that the United States is essentially at a stalemate in this war,” he says. “This is another attempt to apply economic pressure.”
“Another tool that the United States uses,” the expert adds. “We have not seen the administration lay out a clear strategy for military or economic action. There is still no answer to the question of what exactly the United States is trying to achieve.”
How Iran escapes sanctions
Michael Parker, an economic sanctions expert who worked for the US Office of Foreign Assets Control (OFAC) for eight years, sees the new strategy as an attempt to "extend the economic kill radius" of sanctions. That is, direct them against third countries that do business with Iran but depend on the American dollar.
“The US has largely used the threat of these secondary sanctions against foreign financial institutions to persuade states not to violate sanctions policies,” Parker says. “But so far the leverage has not been properly applied to those who simultaneously deal with American dollars and with Iran.”
For example, the expert believes, we can talk about foreign financial institutions that help Iran circumvent sanctions or send funds to it.
It is unclear what Iran's response will be, but experts recall that Tehran has already demonstrated ingenuity to circumvent the sanctions regime, including transporting oil on "shadow fleet" tankers and creating new gasket companies not included in the American prohibition lists.
“We see new names popping up all the time because Iran is adapting so quickly,” says Mohammed Hammouda, LSE manager for export controls and sanctions. “Whatever sanctions are imposed, they find a new way to circumvent them.”
According to Hammouda, Iran often moves one step ahead of regulatory authorities.
“All the sanctions exist on paper, but the hard work of implementing them happens behind the scenes,” he explains. “There are groups of people working all over the world who are trying to enforce sanctions and identify those involved. So Iran has to adapt.”
What will China and others say?
The effectiveness of sanctions will largely depend on the reaction of the countries against which they are imposed. Such states may include US allies Türkiye and Iraq, as well as China.
“Part of this is outside Iran's sphere of influence,” Parker says. “Iran’s ability to circumvent sanctions largely depends on other countries and the willingness of financial institutions to give [Tehran] access to the formal banking system.”
Parker believes that sanctions will be "as strong" as the desire of other states to help US foreign policy under the threat of potentially painful economic measures that would involve the US dollar.
