As Washington pressures Tehran, Gulf states weigh sanctions against the risk of escalation.
US President Donald Trump attends a business forum at the United Arab Emirates presidential palace, Qasr Al Watan, during the final stop of his Gulf visit in Abu Dhabi, May 16, 2025 [File: Reuters/Amr Alfiky]
Nearly six months since the United States and Israel launched the first missiles in their war on Iran, Washington is pivoting to a strategy of tougher sanctions and economic isolation in a bid to force Tehran to accept its terms for a peace deal.
On Monday, US Treasury Secretary Scott Bessent announced “Operation Economic Outcast”, targeting Tehran’s remaining sources of revenue while also threatening penalties against those who continue doing business with Iran.
cial offensive ever” against Iran, and warned that banks and businesses would share in Iran’s isolation if they refuse to cooperate.
“No one is above the reach of US sanctions,” he told reporters.
Gulf states have repeatedly found themselves caught in the crosshairs during the US-Iran war as Iran has targeted US military assets and infrastructure in neighbouring countries.
Economic pressure may appear preferable to another round of US and Israeli missile strikes. But analysts warn the strategy carries its own risks, with Iran potentially responding to mounting economic pressure by targeting more US assets and energy infrastructure across the region.
Iran’s Secretary of the Supreme National Security Council Mohsen Rezaei said last week that if “any countries surrounding Iran join the Americans in their economic war, not a drop of oil will leave the Persian Gulf and the strait of Hormuz”.
In peacetime, one-fifth of the world’s oil and natural gas is shipped by Gulf producers through the critical waterway, which has become the main bone of contention in the war since Iran effectively closed it to shipping at the start of the war.