Though Neither Side Has Launched Major Strikes in Weeks, the War Shows Little Sign of Reaching a Diplomatic Solution in Iran

The U.S. on Monday expanded sanctions on Iran, aiming to cut off the Islamic Republic's economic lifeline while stopping short of the most punishing measures and putting the world on notice to cease doing business with Tehran. Treasury Secretary Scott Bessent said other countries would need to sever business ties with Iran or risk being forced out of the dollar-based financial system. He declined to identify the countries that would be targeted or reveal when those penalties would take effect, saying he would instead provide them time to comply with the new directive.

"We are giving everyone the opportunity to remedy bad behavior. Why would I want to blow up the global financial system?" Bessent said at a news conference. The Treasury Department announced new sanctions on 60 individuals, entities and vessels, but the list did not include any of the Chinese financial institutions suspected of facilitating Iran's oil trade.

Struggling to resolve an unpopular war that has pushed energy prices higher, Washington appears to be counting on further economic pressure even though Iran has spent decades under layers of U.S. and international sanctions that have battered its economy but have not deterred its leadership. Though neither side has launched major strikes in weeks, the war shows little sign of reaching a diplomatic solution. In the meantime, the U.S. is seeking new ways to end Iranian attacks on ships in the Gulf and, more recently via its allies, in the Red Sea.

Before the announcement, Iran threatened both a possible military response and further reduction in oil exports from the Gulf in response to any U.S. economic measures. Afterward, Iranian Economy Minister Ali Madanizadeh said, We are fully prepared for the U.S. sanctions.