President Donald Trump’s sanctions against Iran are designed to shut down the country’s oil industry and “collapse its already buckling economy,” Treasury Secretary Scott Bessent said Thursday.
The U.S. is deploying sanctions against Iran aggressively for “immediate maximum impact,” Bessent told the Economic Club of New York. Trump’s goal is to slash Iran’s oil exports of 1.5 million barrels per day to a trickle, the Treasury secretary said.
“We are going to shut down Iran’s oil sector and drone manufacturing capabilities,” Bessent said. The administration also intends to cut off Tehran’s access to the international financial system, he said.
Prices for U.S. crude oil and the global benchmark Brent turned positive after Bessent’s comments. West Texas Intermediate rose 5 cents to close at $66.37 per barrel by while Brent gained 16 cents to settle at $69.46.
“Making Iran broke again will mark the beginning of our updated sanctions policy,” the Treasury secretary, a former global investment manager, said. “If I were an Iranian, I would get all my money out of the rial now,” he said, referring to Iran’s currency.
CNBC has reached out to Iran’s UN Mission for comment.
Trump reimposed his pressure campaign on Iran through a presidential memorandum on Feb. 4. Two days later, the Treasury Department started imposing sanctions on an international network shipping Iranian oil to China.
Oil prices fell to multiyear lows on Wednesday as Trump’s tariffs against Canada, Mexico and China raised fears among investors that economic growth will slow and crude demand will falter. OPEC+ also confirmed this week that it will gradually bring 2.2 million barrels per day back to the market starting in April.
The oil market right now sees a drop in Iranian supply as the only bullish catalyst for prices, JPMorgan analysts led by Natasha Kaneva told clients in a Thursday note.
Trump, after launching his maximum pressure campaign, has said he wants to negotiate a nuclear deal with Iran. The president said he hoped maximum pressure is “not going to have to be used in any great measure at all.”
“I would much prefer a Verified Nuclear Peace Agreement, which will let Iran peacefully grow and prosper,” Trump said in a social media post on Feb. 5. In 2018, the president withdrew the U.S. from the Joint Comprehensive Plan of Action nuclear deal negotiated by former President Barack Obama.
