US launches ‘Operation Economic Outcast’ against Iran, China refuses to fall in line

The United States on Monday announced fresh sanctions and issued a warning demanding “immediate action” from nations maintaining economic and commercial ties with Iran. The measures are part of the Trump administration’s latest efforts to choke Tehran economically after military strikes and diplomatic negotiations failed to reopen the Strait of Hormuz and end the six-month-long conflict.

Dubbed “Economic D-Day” by the Trump administration, the new actions aim to expand Washington’s secondary sanctions. “Let me be clear: any entity that facilitates money laundering on behalf of Iran will be removed from the US dollar system. The clock just started ticking,” said, US Treasury Secretary Scott Bessent at a press conference. Bessent added that US President Donald Trump is “making phone calls to world leaders with specific requests” to halt their engagement with the Iranian regime but did not identify the countries he had contacted.

‘Operation Economic Outcast’ against Iran marks the beginning of an economic isolation campaign that includes sanctions, secondary sanctions, and cutting off all economic lifelines to Iran. Any country doing business with Iran, facilitating trade, or providing credit, will be hit with secondary sanctions. China has already announced that it will not abide with these US sanctions. Russia is also expected to defy the move. Tehran indicated that its allies have communicated that they do not take the ‘bombast’ from Washington seriously.

“Americans know that no one buys their bombast; the United States is not in an economic position to further restrict its relations with other countries. Iran's trading partners, both in the media and through messages sent to us, have made it clear that they don't take these statements into account anywhere,” posted on X Iran’s chief negotiator and Speaker of the Assembly, M.B. Ghalibaf.

At the press conference, Bessent declared, “In the Second World War, D-Day marked the historic beginning of a campaign with our allies to target and drive the enemy from its positions, including those in third countries. Today, in that same spirit, we are launching an economic onslaught against Iran’s financial connections around the globe. Our objective is to sever every economic lifeline that sustains this tyrannical regime until Tehran stands alone.”

“Washington has already used sanctions, military pressure, war, maritime pressure and psychological operations. So, in their view, the next step is to convince Iranian decision-makers that time is running out and that continued resistance will only make things worse… Tehran does not really see this new economic squeeze as being directed primarily at Iran itself, which has been under sanctions for decades. The real target, in this reading, is third countries: Washington is effectively asking others to enforce the pressure on Iran. In Tehran, this is increasingly seen as an economic war being extended to third parties,” reflected an analyst.

“There is also a clear awareness in Tehran that the economic pressure is meant, at least in part, to push Iranians back onto the streets and trigger a new wave of protests. Iranian authorities, however, seem to consider this increasingly unlikely, particularly in light of what happened during the recent military confrontation. - There also seems to be confidence that major countries such as China and Russia, as well as some regional states, will not simply follow US instructions and, as in the past, have enough political and economic room to resist US pressure.”