What is Operation Economic Outcast, the US's new plan for Iran?

The US is threatening to target the economies of countries that cooperate with Iran as part of what it calls an "economic onslaught" against the Iranian regime. "Operation Economic Outcast" represents a shift in American strategy as its war with Iran approaches the six-month mark with no end in sight. "Our objective is to sever every economic lifeline that sustains this tyrannical regime until Tehran stands alone," US Treasury Secretary Scott Bessent said. What is Operation Economic Outcast? It is essentially an expansion of secondary sanctions on countries, companies and other entities that do business with Iran. Mr Bessent calls it an "economic onslaught against Iran's financial connections around the globe". But few specifics have been announced. The US is first ratcheting up threats against nations and entities that deal with Iran, in the hope they sever ties voluntarily. Mr Bessent indicated the targets would include: - Purchasers of Iranian oil - Shipping companies that transport Iranian oil - Exchange houses that facilitate the movement of Iranian funds - Countries and entities that "turn a blind eye" to sanction-evasion tactics, such as transferring oil between tankers at sea - Banks that facilitate Iranian transactions What measures will it involve? Initially, the US says it is calling on other countries to end economic relationships with Iran. "The president is making phone calls to world leaders with specific requests to cease their interaction with the regime,"Mr Bessent said. But when he was asked which world leaders, he said: "We're not going to name names." He said those who refused the US's requests "should expect to share in the isolation of a withering regime". "Every country has a defined timeline to shut down activities we have identified," Mr Bessent said. But again, he would not give specifics. "I'm not going to set timelines, but we do not have infinite patience here." Five specific sectors of the Iranian economy have been identified and will be targeted with sanctions. They are: - Digital assets - Technology - Gold - Aviation - Shipping The US said it had already sanctioned "nearly 60 entities, individuals and vessels in multiple jurisdictions", including some linked to nuclear and missile technology procurement, cyber operations and oil‑revenue generation networks. Who are 'Iran's enablers'? Mr Bessent's announcement was heavy on threats towards countries that cooperated with Iran, which he called "enablers". But he did not name them. However China, which for years has been Iran's biggest oil customer, is known to be one of Washington's big concerns. "Iran's network of conduits, middlemen, shell companies are dotted everywhere," said Naysan Rafati, a senior Iran analyst at the International Crisis Group. "But in terms of primary economic significance, obviously China, being a major trading partner of Iran, a major oil consumer of Iran when the blockade at least isn't in place, is probably one that the Treasury department will be looking at very closely." The United Arab Emirates (UAE), Iraq, Türkiye and India have also been significant trade partners with Iran in recent years. But the UAE, which has been a target of Iranian retaliatory strikes in the war, last week said it had suspended all trade with Iran. Mr Bessent was asked specifically about Chinese banks that facilitated transactions for Iran, and whether the delicate trade truce with China could prevent those institutions from being targeted. He insisted no-one was above the reach of US sanctions, and said: "We find that the best way to engage with countries is through quiet diplomacy. "We are level setting with every country to tell them our expectations," he said. How is this different to sanctions already in place? Iran has weathered waves of US sanctions for decades. "When it comes to sanctions, we've done the low-hanging fruit, the mid-hanging fruit, the high-hanging fruit, the tree," Alan Eyre, a former US diplomat and member of its nuclear negotiating team until 2015, told NPR. "So there are no new sanctions that are effective." But Mr Rafati said there were multiple factors that meant Iran's economy was particularly vulnerable right now. They include the US blockade on its crude oil exports, its currency tumbling to record lows, high inflation, and extensive war damage to non-oil sectors, including its steel industry. "These measures will undoubtedly have an impact," Mr Rafati said. He said history had shown economic pressure could succeed in pushing Iran to reach agreements with the US. But Iran was only likely to make "a deal that they could also live with — something that was less than total capitulation", he said. "If the [US's] objective is a wholesale kind of surrender by the Iranian system, that is a much taller order," he said. There was also a risk of reigniting violent warfare in the region, he said. "Right now, as we're speaking, the guns have been relatively silent, but the Iranians have the potential to conduct counter pressure strikes against either US allies or US assets … and so it raises the stakes significantly, I think, for all involved."