Let me give you the bottomline up front… Despite positive developments in expanding the ceasefire to include Lebanon and Hezbollah, the Trump administration announced new sanctions on Iran that will end any chance of negotiations with Iran. Unless Trump reverses course, the US is likely to renew its attacks on Iran and will exacerbate the international economic crisis that was ignited by the closing of the Strait of Hormuz.
What a crazy day for intense diplomacy and deal making. Initially, there was a glimmer of hope. It started with the announcement of a ceasefire between Lebanon and Israel, but it was unclear whether that included Hezbollah. By 5 pm eastern daylight time, it was affirmed that this applied to Hezbollah and Israel, although the two sides continued firing at each other until the witching hour arrived.
Iran’s Foreign Ministry Spokesman, Ismael Baqaei, welcomed the development:
"The cessation of war in Lebanon was part of the ceasefire understanding between Iran and America.
From the very beginning, we emphasized the necessity of establishing a simultaneous ceasefire across the entire region, including Lebanon.
We commend the steadfastness of the Lebanese people and the resistance fighters in the face of aggression, and we thank Pakistan for its valuable efforts, especially during the past hours.
We express our solidarity with the Lebanese people and government and emphasize the necessity of the complete withdrawal of the Zionist entity from the occupied territories.
We stress the need for the release of prisoners, the return of the displaced, and the reconstruction of destroyed areas and infrastructure with the support of the international community."
While this is a welcome development, the Trump administration is rejecting another critical Iranian prerequisite for negotiations to end the war, i.e., Iran’s demand that sanctions be lifted. Instead of lifting sanctions, the US Secretary of the Treasury announced a new round of sweeping sanctions that are aimed at Iran and China.
Scott Bessent made several strong statements in on April 14–15 about intensifying economic pressure on Iran through sanctions, with a direct focus on China as Iran’s main oil buyer. Bessent described the new sanctions push as the “financial equivalent” of the earlier US/Israeli kinetic (military) strikes on Iran. He called it part of “Operation Economic Fury”, aimed at cutting off Iran’s revenue streams, especially from illicit oil sales and smuggling networks.
Bessent said that the US would impose secondary sanctions on any countries, companies, or financial institutions that continue buying Iranian oil or that allow Iranian money to flow through their accounts. He described this as a “very stern measure.” He explicitly warned: If Iranian funds are proven to be moving through a bank’s accounts, the US will apply secondary sanctions.
In the course of his diatribe, Bessent revealed that two Chinese banks have already received formal letters from the US Treasury. The letters state that if the banks are found processing Iranian transactions, they face the risk of secondary sanctions. He declined to name the banks. This comes alongside broader Treasury letters sent to financial institutions in China, Hong Kong, the UAE, and Oman.
Bessent went on to accuse China of hoarding oil during the conflict (instead of helping stabilize global markets), limiting exports of certain goods, and continuing to buy large volumes of Iranian crude (historically over 90% of Iran’s oil exports, accounting for about 8% of China’s energy needs). He compared this to China’s behavior during COVID-19 (hoarding medical supplies) and its past threats on rare earth exports, calling it a pattern of unreliability. Bessent stupidly believes the US naval blockade of the Strait of Hormuz, combined with the sanctions threat, will cause China to pause or stop buying Iranian oil. He stated that China “will no longer be able to obtain oil from Iran” under the new enforcement.
To make matters worse, Bessent announced that the Department of the Treasury is canceling sanctions waivers on Iranian (and Russian) oil, targeting Iran’s oil transportation infrastructure and elite smuggling networks (including the Shamkhani family), and working to freeze Iranian leadership funds held abroad. Gulf states are reportedly helping expose hidden Iranian accounts.
I want to emphasize that Bessent made these remarks during White House briefings shortly after a fragile ceasefire in the US-Iran conflict. He said that the goal is to maximize economic pain on the Iranian regime without necessarily resuming large-scale kinetic operations — essentially shifting from military strikes to “maximum pressure” via sanctions and blockades. China is the primary target because it has been Iran’s biggest customer for discounted oil. Bessent framed the policy as a coordinated whole-of-government approach under President Trump to cut off Iran’s funding for terrorism and proxies.
Unless Bessent reverses himself in the next 24 hours there will be no further negotiations between Iran and the United States. China played a critical role behind the scenes in bringing the US and Iran to Islamabad last Saturday for the first round of negotiations. Bessent’s explicit threats against China has enraged the Chinese and solidified their belief that the US is not a reliable negotiating partner. Nope… We’re the enemy.
Any hope that the US could use China to pressure Iran to open the Strait of Hormuz is dashed. This lame, feeble attempt to bully China is backfiring as I write this. Chinese financial analyst, Sean Foo, is gobsmacked by the audacity of Bessent’s threats. China has received the message. Unless the US reverses course, there will be no meeting between Xi Jinping and Trump in China.
