The Trump administration is escalating its sanctions campaign against Iran, aiming to cripple the country’s oil industry and disrupt its economy. Treasury Secretary Scott Bessent said on Thursday that the U.S. is taking steps to shut down Iran’s oil sector and cut its access to international financial systems.
“We are going to shut down Iran’s oil sector and drone manufacturing capabilities,” Bessent told the Economic Club of New York. He added that the goal of the administration’s policy is to collapse Iran’s economy, urging Iranians to move their assets out of the rial.
Crude oil markets react
Following Bessent’s remarks, crude oil prices saw slight gains. West Texas Intermediate (WTI) rose by 5 cents to $66.36 per barrel, while Brent crude increased by 16 cents to $69.46 per barrel. Oil analysts say the expected reduction in Iranian supply is the main bullish factor supporting prices amid broader market uncertainty.
Trump’s latest sanctions follow a presidential memorandum issued on 4 February, reinstating his administration’s “maximum pressure” strategy. This was followed by Treasury Department sanctions targeting a network shipping Iranian oil to China.
Plans to disrupt oil shipments
In addition to financial sanctions, the administration is reportedly considering direct measures to slow Iranian oil exports. According to sources cited by Reuters, the National Security Council is exploring ways to stop and inspect Iranian tankers at key maritime chokepoints. The initiative could involve U.S. allies enforcing inspections under the Proliferation Security Initiative, which was originally designed to curb the trafficking of weapons of mass destruction.
A U.S. official quoted in the report suggested that delaying tanker deliveries would create uncertainty in Iran’s oil trade, reducing its ability to meet supply contracts. Some estimates indicate that this strategy could cut Iran’s exports by 750,000 barrels per day.
Despite Western sanctions, Iran has continued to generate substantial oil revenue. The country is estimated to have earned over $50 billion annually from oil exports in recent years, with shipments rising 50% in February compared to the previous month, according to TankerTrackers.com.
Iranian response and geopolitical risks
Iranian officials have yet to formally respond to the latest U.S. measures, though President Masoud Pezeshkian recently acknowledged that the new sanctions were creating logistical challenges for oil shipments. In the past, Iran has retaliated against U.S. enforcement actions by seizing oil tankers in the Persian Gulf.
The possibility of Iran closing the Strait of Hormuz, a critical passage for global oil shipments, remains a major concern. Previous U.S. attempts to seize Iranian oil cargoes have resulted in retaliatory actions, including the detention of tankers linked to Western companies.
Meanwhile, Iran’s tanker fleet has expanded, with watchdog groups reporting a significant rise in the number of ships involved in oil exports. Many of these vessels are suspected of operating under false flags or using ship-to-ship transfers to evade detection.
Uncertain impact on oil markets
While the U.S. seeks to cut Iranian oil exports to near zero, analysts note that Iran has consistently found ways to circumvent sanctions. The use of smaller tankers and alternative shipping routes has allowed Iran to maintain its trade, particularly with China.
With oil prices under pressure from global economic concerns and OPEC+ production adjustments, the effectiveness of Trump’s latest measures remains uncertain. However, any escalation in U.S.-Iran tensions could introduce new volatility into global energy markets.
