Signal US widens Iran sanctions; Iran vows retaliation as diplomacy stalls

Summary

U.S. Treasury Secretary Scott Bessent unveiled expanded sanctions on August 25, 2026, targeting 60 individuals, entities and vessels, and threatened to exclude countries from the dollar-based financial system if they continue trading with Iran, though he did not immediately name which countries would face this consequence. Iranian Economy Minister Ali Madanizadeh responded that "our defense is no longer so defensive; the enemies should wait for an attack." Brigadier General Hossein Mohebbi of Iran's Islamic Revolutionary Guard Corps pledged severe retaliation targeting American vital interests and energy chokepoints if Iranian infrastructure is threatened. The sanctions come amid stalled diplomatic efforts to end a conflict that began in February 2026 with U.S. and Israeli strikes on Iran. Pakistan has been mediating talks aimed at preventing further escalation and reopening the Strait of Hormuz.