On Monday, Treasury Secretary Scott Bessent warned that Iran's oil industry is under severe strain from expanding U.S. sanctions, suggesting production could deteriorate further and potentially lead to domestic fuel shortages.
US Sanctions Pressure On Iran Oil Industry Intensifies
In a post on X, Bessent said Iran's oil sector is beginning to weaken under what he described as intensified U.S. economic pressure.
"Iran's creaking oil industry is starting to shut in production thanks to the U.S. BLOCKADE," he wrote.
He added that "pumping will soon collapse" and warned of "gasoline shortages in Iran next."
In a separate post, Bessent also issued warnings to international companies and governments, stating that engaging with Iranian airlines or providing services such as fuel, maintenance, or landing support could expose them to U.S. sanctions.
"Doing business with sanctioned Iranian airlines risks exposure to U.S. sanctions," he wrote, urging foreign governments to prevent firms in their jurisdictions from supporting Iranian entities.
He added that the U.S. Treasury would continue its "maximum pressure" campaign and act against third parties that facilitate business with Iran.
US-Iran Tensions Escalate As Oil Risks Rise
On Sunday, Chevron Corp (NYSE:CVX) CEO Mike Wirth warned that oil prices would likely remain under upward pressure as the U.S.-Iran conflict disrupted global supply routes, especially the Strait of Hormuz, which carries about 20% of global oil flows.
He said declining inventories and slow production recovery had left markets more vulnerable to shocks.
Last week, Sen. Lindsey Graham (R-S.C.) backed an expanded oil blockade on Iran, calling it effective in weakening Tehran and warning that countries aiding Iranian oil exports could face consequences.
He said the pressure campaign could widen globally.
Bessent said the ongoing blockade on Iranian ports had reduced Iran's oil revenue and claimed storage limits could soon force shutdowns in production.
He said the U.S. would intensify its "Economic Fury" campaign to further restrict Iran's ability to move and access funds.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
Image via Shutterstock/ Maxim Elramsisy
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