The Iran War Is Entering a New Phase — And This One Is Economic

After nearly six months of conflict with Iran, the United States is turning increasingly toward a different weapon: economic isolation.

On Monday, the Trump administration announced Operation Economic Outcast, a major expansion of sanctions designed to increase pressure on Iran and on the countries and companies that continue doing business with it.

Treasury Secretary Scott Bessent described the strategy as an “economic onslaught.” The new measures expand the sectors that can be targeted by secondary sanctions, including shipping, aviation, technology, gold, and digital assets.

But the policy raises a larger question: How much economic pressure can the United States place on Iran without creating consequences for the rest of the world?

At the center of that question is the Strait of Hormuz, one of the world’s most important energy chokepoints. Shipping through the strait has fallen dramatically during the conflict, disrupting a route that historically carried roughly one-fifth of the world’s oil and liquefied natural gas shipments.

That means U.S. policy toward Iran does not stay contained within the Middle East. Pressure on Iranian trade can affect oil markets, shipping routes, American allies, and countries such as China that have maintained significant economic ties with Tehran.

There is also a diplomatic contradiction developing. While Washington increases economic pressure, Iran and Oman are continuing negotiations over how commercial ships could move through the Strait of Hormuz. Iran’s president has also argued that diplomacy remains the best path toward ending the conflict.

The result is a complicated policy calculation.

Sanctions can give governments leverage without requiring additional military action. But secondary sanctions are especially powerful because they force other countries and companies to make a choice: continue doing business with Iran or risk losing access to the U.S.-centered financial system.

That is what makes this moment bigger than another round of sanctions.

The United States is testing whether control over access to the global economy can accomplish what months of military pressure have not: change Iran’s behavior and move the conflict toward an end.

Whether that pressure produces negotiation—or another form of escalation—may determine what the next phase of the war looks like.