US-Iran conflict: New sanctions loom as Hormuz oil traffic stalls

WASHINGTON: The United States and Iran are trading fresh threats as Washington prepares new sanctions against Tehran and oil traffic through the Strait of Hormuz remains severely disrupted, adding pressure to a conflict approaching its six-month mark.

US Treasury Secretary Scott Bessent is expected to announce details of what the Trump administration has described as the “toughest sanctions in history”. Washington has also urged other countries, particularly China, to support the measures.

China is a key target of the US pressure campaign because it buys more than 80% of Iran’s seaborne oil, according to Kpler data cited by Reuters. Beijing has rejected the sanctions campaign and called for diplomacy instead.

Iranian Foreign Ministry spokesperson Esmaeil Baghaei condemned the planned measures on Saturday, describing secondary sanctions as an attempt to impose “extraterritorial sovereignty” on independent countries. He said such sanctions had no basis in international law.

President Donald Trump has warned that countries providing Iran with “any type of lifeline” could face economic consequences. He also said Iran wanted a deal but was unwilling to accept what he considered acceptable terms.

Despite the escalating rhetoric, the two sides were not exchanging fire at the time and were not engaged in active peace talks, leaving the conflict in an uneasy stalemate.

Hormuz shipping faces severe disruption

The Strait of Hormuz has emerged as one of the conflict’s main pressure points as commercial shipping through the strategic waterway has fallen sharply.

Only a small number of commodity vessels have recently crossed the strait, while major crude oil and liquefied natural gas tankers have largely avoided the route. Reuters reported that oil shipments through the waterway had virtually halted as Iran continued to use control over shipping as leverage.

The disruption is significant because the strait normally carries about one-fifth of global traded oil. The decline in traffic has raised concerns about tighter supplies, higher energy prices and increased pressure on countries dependent on Gulf energy.

The United States has maintained a naval blockade around Iran and says it can sustain its regional presence. Tehran, meanwhile, has continued to threaten vessels attempting to pass through the waterway without authorisation.

The disruption has also pushed up shipping costs and left vessels waiting in and around the Gulf as companies assess the risks of crossing the strait.

Iran faces growing economic pressure

The sanctions threat comes as Iran faces mounting economic difficulties following months of war and years of international restrictions.

Iranian Parliament Speaker Mohammad Baqer Qalibaf acknowledged the economic pressure, saying military strength alone would not be sufficient if people lacked food and the economy could not sustain financial activity, production and growth.

President Masoud Pezeshkian has called for a diplomatic solution, saying ending the conflict while Iran remains in what he described as a position of strength would be preferable.

Iran’s military leadership has adopted a tougher stance. Armed Forces Chief of Staff Maj Gen Ali Abdollahi warned that Iran would respond to new threats with “crushing, punishing and devastating” force.

The conflict has killed thousands of people, drawn Gulf states into the crisis and disrupted energy markets. The United States has also reported military casualties.

Trump has yet to achieve several objectives announced at the beginning of the conflict, including dismantling Iran’s nuclear programme and creating conditions for a change in the country’s leadership. The status of Iran’s nuclear facilities remains uncertain because UN inspectors have been unable to access them since 2025.

China under pressure over Iranian oil

China is likely to face particular pressure from Washington because it remains Iran’s most important oil customer.

Bessent has urged Beijing to cooperate with the US sanctions campaign, arguing that countries benefiting from Iranian energy should help enforce economic pressure on Tehran. China has maintained that sanctions and pressure will not resolve the conflict.

The pressure comes as Iranian oil exports to China have already been affected by the US blockade. Reuters reported that Iranian oil offers to Chinese buyers have fallen sharply, while some shipments have become more expensive as supplies tighten.

The United States is also seeking broader international support to keep the Strait of Hormuz open. NATO members have discussed possible ways individual countries could contribute to freedom of navigation, although the alliance has stressed that the effort is not an official NATO mission.

With Washington preparing tougher economic measures and Tehran warning of retaliation, the next phase of the conflict could be shaped as much by sanctions, oil supplies and control of shipping routes as by military action.

The continuing uncertainty around the Strait of Hormuz is likely to keep global energy markets and governments on alert.