Iran Threatens Retaliation as U.S. Widens Sanctions

Iran threatened an aggressive response to the latest U.S. sanctions announced on Monday by Treasury Secretary Scott Bessent, with a top government official noting Tehran was “fully prepared for the U.S. sanctions.”“Naturally, the enemies intend to launch an economic terrorist attack on us, but we also have our own tools and know how to play the game,” Iran’s economy minister Ali Madanizadeh said, as quoted by Reuters earlier today. “Our defense is no longer so defensive; the enemies should wait for an attack.”Madanizadeh also said Russia and China had not accepted the latest U.S. sanction salvo and said he expected other trade partners to do the same.The statement follows the announcement on Monday of “Operation Economic Outcast”, targeting Iran’s trade partners and giving them an unspecified period of time to wind down their activities involving Iran.The U.S. Treasury also sanctioned a total of 60 individuals, entities, and tankers, with oil trade remaining a prime target for sanction action from Washington. The list, however, did not include any of the major Chinese financial institutions suspected of facilitating Iran’s oil trade. According to analysts cited by Reuters, the U.S. is unwilling to risk Chinese retaliation to any specifically targeted action on Chinese entities doing business with Iran in oil.Iran, meanwhile, threatened military action in response to the sanctions before they were formally announced.Despite these unfavorable developments in a war that has caused a global energy commodity crisis, oil prices moved lower at the start of the week, although they remain considerably higher than pre-war levels.China is the biggest buyer of Iranian crude, taking in over 80% of the country’s exports of crude. The Strait of Hormuz crisis and, more specifically, the U.S. naval blockade of Iran has caused a sharp drop in those exports, with shipments since the start of this month estimated at 534,000 barrels daily, down from 823,000 barrels daily in July.By Irina Slav for Oilprice.comMore Top Reads From Oilprice.comTreasury Expands Iran Sanctions Without Targeting Major Chinese BanksEurope Dodges a Rhine Crisis for the Worst Possible ReasonOil Nears $100 as Trump’s ‘Economic D-Day’ Raises the Stakes