US President Donald Trump announced on August 19, 2026, a campaign to impose the "most crushing economic operation ever" against Iran, including unprecedented economic warfare and isolation measures [1, 2, 3, 4, 5, 6, 7, 8]. Trump declared that any country whose financial institutions, businesses, airports, or government bodies provide lifelines to Iran will face "tremendous economic consequences" [1, 2, 3, 4, 9, 5, 6, 7, 8]. He did not specify which countries would be targeted but highlighted China as a major focus, noting it buys over 80% of Iran’s exported oil and is its biggest trading partner [3, 9, 5, 10, 11].

Trump’s announcement follows warnings from US Treasury Secretary Scott Bessent, who on August 20 urged allies and China to support Iran's economic isolation or face consequences, promising detailed measures on August 24 [1, 4, 5, 7, 8]. Bessent called the campaign "the greatest coordinated economic isolation in the history of the world," asserting, "we are going to collapse this regime" [7].

The new US strategy marks a shift from military strikes toward economic pressure after nearly six months of war, driven by a military stalemate and munitions shortages amid the impending US midterm elections in November [1, 3, 5, 6, 7, 8]. The economic crackdown aims to halt activities including oil smuggling, swap lines, cash transfers, exchange houses, ship registries, and front companies supporting Iran [4, 5, 6].

In August, the United Arab Emirates aligned with US policy by severing all trade and financial ties with Iran, citing missile threats linked to Tehran [3, 9, 10, 11]. Iran’s Foreign Minister Abbas Araghchi dismissed Trump’s plan as "economic terrorism," calling it a continuation of failed US policies and a threat to global economic sovereignty [6, 7, 11, 8].

China urged a diplomatic solution, with Foreign Ministry spokesperson Lin Jian stating sanctions "will not solve the problem" and calling for responsible political measures [10, 11]. Chinese analysts say curtailing Iran trade would have minor impact given China’s broader economy and alternative oil sources, while others warn that targeting Chinese oil imports is a major red line risking confrontation [3, 5, 11].

Iran’s economy remains resilient despite longstanding sanctions, still exporting oil through complex networks including shadow tankers [5, 6]. Trump also indicated the Strait of Hormuz could be treated as "new U.S. territory" amid ongoing blockades, a remark he first posted on social media on August 18 [1, 2].

The US Treasury Secretary is scheduled to hold a press conference on August 24 to unveil further economic measures against Iran [7, 8].