Washington warns countries to end economic ties with Iran or face secondary sanctions; Tehran says it is ‘fully prepared’

US Treasury Secretary Scott Bessent on Tuesday warned countries to cut their economic and business ties with Iran or face secondary sanctions. However, the Trump administration has held off on imposing penalties as of now. Bessent’s comments came as America launched an “economic D-Day” against Iran as the US-Iran war entered its sixth month. The move, which Bessent described as an “economic onslaught”, aimed at pressurising Iran and limiting its capabilities to continue the war.

Bessent said the US was broadening the scope of commercial activities that could face secondary sanctions across five sectors of Iran's economy: digital assets, gold, technology, aviation, and shipping.

Bessent said the US would give countries time to decide before taking any action. "Why would I want to blow up the global financial system? We believe that it is important to level set and give people a cure period, but they should know that that will move very quickly and that we are serious," he told a press conference.

“Fully prepared for the US sanctions”

However, Iran responded to the US threats by saying it was "fully prepared for the US sanctions" and said that it would result in another defeat for Washington.

Iran's Economy Minister Ali Madanizadeh said Iran had been "waiting for these plans for a long time”.

“The government is and was ready and has a two-year plan to manage these events. We also have our own tools and know how to play the game,” he told state television.

Earlier, Iran warned that it would not let the flow of “a single drop of oil” through the Strait of Hormuz and the Persian Gulf in response to America’s newly imposed economic sanctions.

Will the US be able to stop China from supporting Iran?

China has for several years remained the biggest buyer of Iranian oil, while Washington has stepped up efforts to curb Chinese purchases. However, the US has so far stopped short of imposing sanctions on Chinese banks over such transactions.

Asked whether the US Treasury was now prepared to target a Chinese bank, he said no country was beyond the reach of US sanctions, adding: "If they facilitate transactions and are part of the ecosystem that turns Iranian oil into money, into repression, they will be targeted."