Trump Keeps Military Options Open as Iran Economic War Hits $93 Oil

Trump's pivot to "economic D-Day" against Iran is escalation, not retreat — the president said Thursday the campaign won't constrain U.S. military options.

Trump said Thursday that Iran isn't ready for a "suitable agreement" and that his shift to economic warfare won't limit U.S. military options, as Brent crude climbed toward $94 a barrel on the Strait of Hormuz blockade.

"We have complete control over the entire region around the Strait of Hormuz, including its hinterland and land areas," Trump said at Joint Base Andrews. "So they very much want to reach an agreement, but in my view they're not ready to reach a suitable agreement."

The remarks came as Treasury Secretary Scott Bessent touted the campaign as "the greatest coordinated economic isolation in the history of the world," with the naval blockade having stopped 67 ships through Thursday. Brent crude rose nearly 2 percent to $93.90 a barrel, while the S&P 500 slipped 0.4 percent and the Dow Jones Industrial Average fell 430 points.

The stakes are steep: the Strait of Hormuz carried about a fifth of global oil trade before the war began Feb. 28, and the U.S. national debt topped $40 trillion Wednesday. With midterm elections months away, Trump is betting economic pressure can force Tehran's capitulation without reigniting a military conflict.

Bessent's "One-Two Punch" Targets Allies and Rivals

Bessent framed the campaign as a "one-two punch" combining the naval blockade with the toughest sanctions in history, warning that "you are either with us or against us." The Treasury has already sanctioned 10 people accused of smuggling millions of dollars in cash to the Iran-backed Hezbollah militia, including Turkish businessman Yunus Alper Yilmaz. China, a major buyer of Iranian oil, dismissed the pressure campaign, with foreign ministry spokesman Lin Jian saying "sanctions and pressure will not help resolve the issue."

The escalation echoes Trump's first-term maximum-pressure campaign, which repeatedly required waivers for countries dependent on Iranian crude. "Trump's strategy now rests on targeting Tehran directly by impeding its touch points and access to the formal financial system," said Behnam Ben Taleblu, senior director of the Iran program at the Foundation for Defense of Democracies.

Iran Dismisses Threats as Tehran Hardens

Iranian officials rejected the economic offensive as a sign of American weakness. "The military war did not work, so now they have called the next defeat an 'economic war,'" Deputy Foreign Minister Kazem Gharibabadi wrote on X. Foreign Minister Abbas Araghchi called the "economic D-Day" a "diversion from America's own crisis: unprecedented debt and surging interest costs," adding, "We have seen this movie before. Same bull. Different bullies."

Ali Vaez, Iran director at the International Crisis Group, said the pressure campaign has "hardened Iran's position," arguing that "the only thing that the Iranian regime views as more dangerous than suffering from U.S. sanctions is surrendering to U.S. terms." The last time Washington pursued maximum pressure, in 2018-2020, Iran responded by escalating its nuclear enrichment and attacking oil tankers in the Gulf, sending Brent above $70 before the pandemic crushed demand.

Oil Markets Price the Risk Premium

Brent crude hovered near a three-week high of $93.90 a barrel Thursday, up nearly 2 percent, while West Texas Intermediate traded around $86. Bessent said oil markets are "misinterpreting" the policy, arguing that maximum economic pressure makes "a large-scale kinetic restart" less likely. Trump, meanwhile, said the Strait of Hormuz "won't be as important as it was in the past," citing at least seven pipeline projects under construction or in planning that could eventually bypass the chokepoint — though analysts say those routes are years from completion.

The U.S. has shown no sign of easing the blockade, reinstated July 14, with the USS George Washington arriving in the region Wednesday to replace the USS Abraham Lincoln after a nine-month deployment. Trump said the U.S. might return to negotiations "at some point," but insisted Iran must abandon its nuclear program. "Iran cannot have a nuclear weapon, and they won't," he said.

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