U.S. Treasury Secretary Scott Bessent said Thursday that the Trump administration’s new economic campaign against Iran is ultimately intended to bring down the Islamic Republic, as Washington prepares what it says will be an unprecedented new round of sanctions alongside its naval blockade.
Bessent said the measures would be detailed at a news conference Monday and described the strategy as a combination of the blockade and what he called the toughest sanctions ever imposed on a country. “It is going to work in Iran and we are going to collapse this regime,” Bessent told CNBC.
The declaration is significant because President Donald Trump himself has not explicitly said regime collapse is the objective, leaving unclear whether Bessent’s unusually blunt wording represents formal administration policy or his own description of the expected outcome.
Trump on Wednesday announced what he called an “ECONOMIC D-DAY,” promising economic warfare and isolation against Iran on an unprecedented scale and threatening consequences for countries, companies and institutions that continue providing Tehran with an economic lifeline.
The new campaign is expected to target not only Iran but third countries that continue trading with it, including through oil purchases, financial transfers and sanctions-evasion networks.
Bessent said it was time for U.S. allies and other countries to decide whether they would cooperate with Washington’s campaign. He indicated that the Treasury Department and wider U.S. government would use their enforcement powers against entities that continue enabling Iranian trade.
The strategy effectively puts governments and businesses around the world on notice that maintaining commercial links with Tehran could expose them to U.S. economic penalties.
One of the biggest unresolved questions is China. Beijing remains Iran’s most important oil customer, purchasing more than 80% of Iran’s seaborne crude in 2025, according to Kpler data cited by Reuters. But when Bessent was asked whether Washington would also punish China for continuing to do business with Tehran, he declined to give a direct answer, saying some conversations were better conducted privately.
He nevertheless pointed to Beijing’s dependence on Persian Gulf energy supplies, arguing that China has a strong interest in helping restore normal traffic through the Strait of Hormuz. “Keep in mind that the Chinese get 50% of their energy from inside the Gulf,” Bessent said, adding that cooperation with Washington would therefore serve Beijing’s own interests.
The dilemma is considerable. Punishing Chinese trade with Iran could intensify pressure on Tehran, but it could also reopen economic confrontation between Washington and Beijing after Trump reached agreements that had eased previous trade tensions.
The economic campaign comes as China maintains close strategic ties with Iran, with reports in recent weeks also raising questions over possible military assistance to Tehran.
Despite Washington’s rhetoric, many analysts doubt that even a combination of a naval blockade and severe secondary sanctions can quickly force Iran’s economy, or its political system, to collapse.
Iran has endured extensive U.S. sanctions for decades and entered the latest conflict already suffering from deep structural economic problems. The International Monetary Fund expects Iran’s economy to contract by 5.4% this year. The Wall Street Journal reported that annual inflation is now running above 80%, while shortages and rapidly rising prices are eroding living standards.
Iran’s oil revenues have also been hit particularly hard. According to Capital Economics data cited by the Journal, Iranian oil exports fell from about $4.5 billion in June to close to zero in July after the U.S. reimposed its blockade. The pressure is severe. But economic pain does not necessarily translate into political capitulation. Instead, Iran is increasingly reorganizing its economy around endurance rather than recovery.
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