The US hit Iran with "unprecedented sanctions" yesterday by adding an additional 700 organisations and individuals to its list of entities facing an embargo. The move, which is aimed at pressuring Iran to curb its nuclear programme, brings the total number of entities facing the wrath of America to 900.
The list includes 50 Iranian banks, 200 individuals and shipping vessels tied to Iran's shipping and energy sector, as well as the national airline, Iran Air, and more than 65 of its aircraft.
Speaking of the fresh sanctions, promised by US President Donald Trump after withdrawing from the nuclear deal singed by former President Barack Obama in 2015 Steven Mnuchin, US treasury secretary, said yesterday: "Today, the US is executing on the final actions to withdraw [from] the Obama administration's fatally flawed Iran deal."
Denouncing Iran as a destabilising force, Mnuchin added, "this is part of a maximum unprecedented economic pressure campaign that the US is waging against the world's largest state sponsor of terror."
However eight countries have been granted a temporary exemption for six months despite US warning previously that it would be harder for Iran's oil importers to get a waiver. The exemption will allow China, India, Japan, South Korea, Taiwan, Italy, Greece and Turkey, to continue trading with Iran as normal.
US Secretary of State Mike Pompeo said that more than 20 countries have already cut their oil imports from Iran, reducing purchases by more than one million barrels per day. State department officials expressed American desire to bring Iran's oil export, which makes up 80 per cent of its revenue, to zero in the coming months.
The Trump administration's intensifying effort to strangle Iran's economy, critics say, marks a gamble as it divides the US from traditional allies in Europe and casts uncertainty into oil markets. It is also likely to deepen humanitarian suffering inside the Islamic Republic and undercut moderates in Tehran who might be open to working with the US.
It's traditional ally, Europe is still in talks over how to establish a payments channel that allows European companies to continue trading with Tehran without being penalised by the US.
Yesterday the Financial Times reported that plans by European diplomats to establish a special channel to safeguard non-US trade with Iran would not be ready in time.
Tehran has claimed a diplomatic victory against the US with Europe still pressing hard to salvage the 2015 nuclear deal and taking steps to establish a payments channel to bypass the sanctions. But this has faced a set back with the FT reporting that the international financial messaging system based in Belgium, saying that it would comply with the restored US sanctions and suspend "certain Iranian banks'" access to its cross border-payment network.
Despite this, Iran remains confident that it will be the US who comes out worse. "Today, Iran is able to sell its oil and it will sell," President of Iran Hassan Rouhani said. "We are in the economic war situation. We are confronting a bullying enemy. We have to stand to win."
Yesterday Iranian parliament's speaker, Ali Larijani, echoed Rouhani's remarks with a defiant message to the US in which he insisted that Trump's reign will experience an inglorious end just like Saddam Hussain.