The US military campaign against Iran has so far failed to force the regime to capitulate. The Trump administration is betting once again that suffocating economic pressure will do the job.
Facing a shortfall of necessary munitions and wary of continuing an unpopular war, Trump and his top officials are returning to a familiar playbook: relying on a steady increase in economic sanctions and a naval blockade to stifle Iran’s oil exports.
The renewed emphasis on economic pain — it was dubbed “Maximum Pressure” in Trump’s first term — is a marked pivot for an administration that has repeatedly threatened a stepped up military campaign after nearly six months of war against Tehran.
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While the approach failed to bring about the result President Donald Trump wanted before 2020, he and his team argue it will this time around.
“Operation Economic Fury, led by Secretary Scott Bessent, is devastating the Iranian economy,” US Ambassador to the United Nations Mike Waltz told Fox News on Aug. 10. He said the country would “absorb the bombings” but that Iranians were more afraid of Bessent than Defense Secretary Pete Hegseth.
Trump made a similar comment on Sunday to Axios, saying he is “low-keying it” with Iran. “We are just watching Iran with its huge inflation and the fact they have no money.” Bessent hit a similar theme weeks before on Fox, saying “the government is causing the people to suffer, and we’re going to keep pressing.”
That echoes an argument put forward by some analysts who argue that the regime is teetering toward economic collapse while having fewer options to evade sanctions via other countries such as the United Arab Emirates.
“As jurisdictions once exploited for sanctions evasion, including the UAE, become way less hospitable to Iranian illicit finance and trade, and global markets reduce their dependence on Iranian commodities, existing US sanctions become far more potent,” said Miad Maleki, a former US Treasury sanctions official who is now a senior fellow at the Foundation for Defense of Democracies.
Iran’s economy has already taken a significant hit from the war, with much of its industrial capacity destroyed and crude exports severely curtailed by the US blockade. Central bank data shows year-on-year inflation recently reached 77%.
The currency, meanwhile, has fallen more than 10% from its prewar level, adding to the economic pressure on Iranians. A depreciation of the rial sparked violent nationwide protests at the start of the year, leading to a crackdown by authorities that killed thousands of people. There have been no signs of the anti-government demonstrations resuming.
The US military campaign against Iran has so far failed to force the regime to capitulate. The Trump administration is betting once again that suffocating economic pressure will do the job.
Facing a shortfall of necessary munitions and wary of continuing an unpopular war, Trump and his top officials are returning to a familiar playbook: relying on a steady increase in economic sanctions and a naval blockade to stifle Iran’s oil exports.
The renewed emphasis on economic pain — it was dubbed “Maximum Pressure” in Trump’s first term — is a marked pivot for an administration that has repeatedly threatened a stepped up military campaign after nearly six months of war against Tehran.
While the approach failed to bring about the result President Donald Trump wanted before 2020, he and his team argue it will this time around.
“Operation Economic Fury, led by Secretary Scott Bessent, is devastating the Iranian economy,” US Ambassador to the United Nations Mike Waltz told Fox News on Aug. 10. He said the country would “absorb the bombings” but that Iranians were more afraid of Bessent than Defense Secretary Pete Hegseth.
Trump made a similar comment on Sunday to Axios, saying he is “low-keying it” with Iran. “We are just watching Iran with its huge inflation and the fact they have no money.” Bessent hit a similar theme weeks before on Fox, saying “the government is causing the people to suffer, and we’re going to keep pressing.”
That echoes an argument put forward by some analysts who argue that the regime is teetering toward economic collapse while having fewer options to evade sanctions via other countries such as the United Arab Emirates.
“As jurisdictions once exploited for sanctions evasion, including the UAE, become way less hospitable to Iranian illicit finance and trade, and global markets reduce their dependence on Iranian commodities, existing US sanctions become far more potent,” said Miad Maleki, a former US Treasury sanctions official who is now a senior fellow at the Foundation for Defense of Democracies.
Iran’s economy has already taken a significant hit from the war, with much of its industrial capacity destroyed and crude exports severely curtailed by the US blockade. Central bank data shows year-on-year inflation recently reached 77%.
The currency, meanwhile, has fallen more than 10% from its prewar level, adding to the economic pressure on Iranians. A depreciation of the rial sparked violent nationwide protests at the start of the year, leading to a crackdown by authorities that killed thousands of people. There have been no signs of the anti-government demonstrations resuming.
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