At the G20 meeting in North Carolina, Treasury Secretary Scott Bessent said the U.S. plans to “economically asphyxiate” Iran.
- Bessent said the U.S. could announce new sanctions targeting Iranian banks this week and again next week.
- He added that Washington has held private discussions with China regarding Iran while emphasizing that the U.S. does not want to “pull apart” from China.
- Bessent also said the Strait of Hormuz could become “like a worthless piece of water” within two years as alternative routes develop.
U.S. Treasury Secretary Scott Bessent said on Tuesday that the Trump administration could announce new sanctions targeting Iranian banks this week and next, and that Washington has held private discussions with China over Iran.
Bessent’s comments at the G20 meeting in North Carolina came as oil prices climbed and broader U.S. markets traded lower. As of this writing, WTI futures maturing in October rose 2.4% to above $87.83 a barrel, while Brent futures maturing in November gained nearly 2% to $92.26. The United States Oil Fund (USO) was up more than 2% in morning trade.
Meanwhile, U.S. indices were on track to kick off September in the red as inflation worries and tensions in the Middle East weighed on markets. The SPDR S&P 500 ETF (SPY) fell 0.3%, the SPDR Dow Jones Industrial Average ETF (DIA) was flat, and the Nasdaq-100 tracking Invesco QQQ Trust (QQQ) moved 0.98% lower.
On Stocktwits, retail sentiment around SPY dipped to ‘neutral’ from ‘bullish’ territory over the past day, even as chatter rose to ‘normal’ from ‘low’ levels. Sentiment around DIA and QQQ remained in the ‘neutral’ zone.
Bessent said the U.S. has “zero tolerance” for Iran and plans to intensify economic pressure on the regime. “We are going to economically asphyxiate this regime,” the U.S. Treasury stated.
Bessent Warns Of More Iran Bank Sanctions
Bessent said the Treasury has been using new authorities to target Iran across digital assets, aviation and maritime industries.
He also warned that countries and entities helping Iran circumvent the embargo could face secondary sanctions, including losing access to the U.S. dollar and U.S. banking systems.
“Everyone should expect that we know who you are, you know who you are,” Bessent said, adding that the U.S. would “probably” announce a bank sanction this week and another the following week.
Bessent Says US Does Not Want To ‘Pull Apart’ From China
Despite the escalating pressure on Iran, Bessent said Washington does not want to sever economic ties with China. “We do not want to pull apart from China,” he said, while adding that the U.S. needs to “derisk” its relationship with Beijing.
Bessent also said the U.S. has held private discussions with China regarding Iran, although he did not provide details on the nature or outcome of those talks.
The comments come as energy markets closely watch developments around Iran and the Strait of Hormuz, a critical route for global oil shipments.
“That will be bypassed in two years,” Bessent said when discussing the waterway. “In two years, the Strait of Hormuz will be like a worthless piece of water.”
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