Iran vows to retaliate after US widens sanctions
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Before the announcement, Iran threatened both a possible military response and further reduction in oil exports from the Gulf in response to any US economic measures.
PHOTO: REUTERS
- Iran vows to retaliate against expanded US sanctions, confident major trading partners will resist Washington's pressure.
- US Treasury unveiled sanctions targeting 60 entities but avoided punishing key Chinese banks to prevent global financial disruption.
- Pakistan mediates peace talks, urging the US to change its approach as tensions and regional conflicts continue without resolution.
AI generated
CAIRO/WASHINGTON – Iran pledged to fight back against expanded US economic sanctions aimed at isolating its economy, expressing confidence that major trading partners would resist Washington’s pressure campaign.
Almost six months into a war the US has struggled to resolve, Treasury Secretary Scott Bessent unveiled the measures on Aug 24 but stopped short of the most punishing sanctions.
While he said countries that continued trading with Iran risked being forced out of the dollar-based financial system, he declined to give a timeline or identify which may be targeted, saying he would give them time to comply with the new directive.
“Why would I want to blow up the global financial system,” he said, when asked why the measures had not gone further.
The Treasury Department did announce new sanctions on 60 individuals, entities and vessels, but the list did not include any of the Chinese financial institutions suspected of facilitating Iran’s oil trade.
“We want to make clear here today that no one is above the reach of US sanctions,” Bessent said in response to a question about Chinese banks. China has been the biggest buyer of Iranian oil for several years, although Iranian oil flows to China have been cut since Washington restarted a blockade of Iran’s ports in mid-July.
Experts say Washington is wary of Chinese retaliation for any sanctions on its banks ahead of expected talks in September between US President Donald Trump and Chinese President Xi Jinping, with any curbs on China’s exports of critical minerals especially sensitive.
China said on Aug 25 that its cooperation with Iran is conducted within the framework of international law and should not be interfered with or disrupted. Oil prices fell for a second day as traders brushed off the impact of the sanctions, although market participants remained wary of Iran’s continued ability to disrupt shipping.
Oil tanker struck near Strait of Hormuz
An oil tanker was struck on Aug 25 by an unidentified projectile and disabled about nine nautical miles north-east of Oman’s Ash Shishah, which lies at the entrance to the Strait of Hormuz, the United Kingdom Maritime Trade Operations said.
Before news of the latest sanctions, Iran threatened both a possible military response and further reduction in oil exports from the Gulf in retaliation for any US economic measures.
After they were unveiled, Iranian Economy Minister Ali Madanizadeh said that Iran was prepared.
“Our defence is no longer so defensive; the enemies should wait for an attack,” he told state television. Neither China nor Russia had “accepted” the US measures, he added, predicting that other countries would resist them.
Brigadier-General Hossein Mohebbi, a spokesperson for Iran’s Islamic Revolutionary Guard Corps, vowed heavy blows to US vital interests and energy chokepoints if Iran’s infrastructure was threatened, Press TV reported.
Iran and the US signed an interim deal in June aimed at ending the war that began with US and Israeli attacks on Iran in February, but it quickly faltered, and Iran resumed attacks that have blocked most energy exports from the Gulf.
Mediator Pakistan made “significant progress” in the latest talks with Tehran that focused on measures such as prevention of further escalation of the conflict and the reopening of the Strait of Hormuz, the Pakistani military said in a statement on Aug 25.
“We had a very constructive exchange on the issues involved,” Pakistani Interior Minister Mohsin Naqvi, who accompanied army chief Asim Munir to Tehran, said on social media platform X.
An official at the Iranian president’s office, Mehdi Tabatabaei, said on X that Munir’s visit to Iran “yielded highly valuable diplomatic achievements, the results of which will soon be revealed”.
The White House and the State Department did not immediately respond to requests for comment made outside business hours.
Little sign of diplomatic solution
Despite no major strikes by either side in weeks, there is little sign of a diplomatic solution.
Iran has spent decades under layers of US and international sanctions that have battered its economy but have not deterred its leadership.
US public approval of the war fell to its lowest level since the conflict’s early days, with Trump’s popularity at a record low ahead of congressional elections in November, a Reuters/Ipsos poll that closed on Aug 24 showed.
Oil transits through the Strait of Hormuz were at five million barrels per day on Aug 24, provisional tracking from shiptracker Vortexa showed, down from more than 20 million per day before the war, or about one of every five barrels consumed worldwide.
Thousands of people have died in the conflict, most of them in Iran and Lebanon, while much of Iran’s conventional military capacity has been degraded. Its economy is also suffering, and then Supreme Leader, Ayatollah Ali Khamenei, was killed early in the war.
But Iran is still able to attack Gulf neighbours and threaten oil tankers.
The exact state of Iran’s nuclear programme, which the Americans and Israelis aim to wipe out, remains unknown. REUTERS
