The Trump administration is simultaneously tightening financial pressure on Iran and preserving the possibility of military action, with War Secretary Pete Hegseth saying U.S. forces could conduct strikes in or around the Strait of Hormuz while Treasury gives Tehran’s foreign trading partners an opportunity to sever economic ties before facing broader sanctions.
By yourNEWS Media Newsroom.
The United States is keeping military force available as an option against Iran even as the Trump administration launches an expansive economic campaign intended to cut Tehran off from the international financial system and deprive the Iranian government of its remaining sources of revenue.
War Secretary Pete Hegseth said Monday that Washington has not ruled out additional military action, including strikes connected to the Strait of Hormuz, the strategically critical waterway through which a significant share of global energy shipments travel.
“By no means are we foreclosing using kinetic strikes anywhere in the Strait of Hormuz or around Iran,” Hegseth told reporters, according to Reuters.
Hegseth also said Iran would be unable to withstand the scale of economic pressure the administration is preparing to impose.
His remarks underscored the dual-track strategy now being pursued by President Donald Trump’s administration: intensify economic isolation while retaining the ability to resort to military force if the confrontation with Tehran escalates.
The military warning came the same day Treasury Secretary Scott Bessent formally launched “Operation Economic Outcast,” an effort designed to eliminate the financial and commercial networks that continue providing Iran access to oil revenue, technology and international markets.
Treasury imposed sanctions Monday on more than 60 individuals, entities and vessels linked to Iran, according to Reuters.
The targets are accused of facilitating activities involving Iranian petroleum revenue, procurement for nuclear and missile programs and other operations supporting Tehran.
Those measures represent only one component of what Bessent has described as an “economic D-Day” against Iran.
The broader strategy is intended to pressure not only Iranian entities but foreign governments, financial institutions, shipping companies and businesses that continue helping Tehran conduct international commerce.
Washington has warned those parties that continued economic engagement with Iran could expose them to secondary sanctions capable of restricting or eliminating their access to the U.S.-dominated financial system.
The administration did not impose the full range of those secondary penalties Monday, however.
Instead, the United States is giving foreign governments and companies an opportunity to end their dealings with Iran voluntarily before Washington expands its sanctions campaign.
That approach combines the threat of severe financial consequences with private diplomatic pressure designed to convince Iran’s commercial partners that maintaining access to American markets and financial infrastructure is more valuable than preserving ties with Tehran.
Bessent has increasingly framed the decision confronting Iran’s trading partners as a choice between the Iranian economy and the U.S. financial system.
The policy could carry particularly significant consequences for China, which has been Iran’s largest customer for petroleum.
China has remained a major purchaser of Iranian oil despite longstanding international restrictions on Tehran’s exports, making Chinese buyers and financial networks important to Iran’s ability to continue generating revenue.
Reuters reported that major Chinese institutions were not included among the entities sanctioned Monday.
Their exclusion indicates that Washington is, for the moment, relying on diplomatic pressure and the prospect of future sanctions rather than immediately targeting some of the largest institutions connected to Iran’s primary trading partner.
That restraint could change if governments and businesses refuse to comply with American demands.
The administration has warned that parties continuing to provide Iran with economic lifelines could ultimately face the full force of U.S. sanctions.
Operation Economic Outcast therefore expands pressure in stages.
The first phase directly targets Iranian-linked individuals, businesses, vessels and networks that Washington believes are helping Tehran generate revenue or acquire strategically important materials.
The second relies on the threat of secondary sanctions to persuade foreign actors to stop facilitating Iranian trade before they themselves become targets.
If those efforts fail, Washington could broaden enforcement to foreign banks, companies and other institutions that continue processing Iranian transactions or supporting Tehran’s commercial operations.
The financial offensive follows months of military confrontation and unsuccessful attempts to secure a lasting agreement with Iran.
Rather than treating sanctions and military action as separate alternatives, the administration is now pursuing economic pressure while explicitly preserving its ability to use force.
Hegseth’s reference to the Strait of Hormuz is particularly significant because of the waterway’s importance to global energy markets and its central role in the confrontation surrounding Iran.
His statement makes clear that the administration does not consider the launch of its expanded sanctions campaign a substitute for potential military operations.
“By no means are we foreclosing using kinetic strikes anywhere in the Strait of Hormuz or around Iran,” Hegseth said.
For now, the administration appears to be giving foreign governments and companies a window to distance themselves from Tehran before escalating the economic campaign against them.
The strategy allows Washington to increase pressure without immediately sanctioning every foreign participant in Iranian commerce while signaling that failure to cooperate could result in much broader financial isolation.
At the same time, Hegseth’s comments leave Tehran facing pressure from two directions: an increasingly aggressive effort to eliminate the revenue and international financial connections supporting the government, and the continuing possibility that U.S. military forces could again be used against Iranian targets or operations surrounding the Strait of Hormuz.
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