Summary

The US naval blockade and mounting economic pressure are tightening the screws on Iran’s already fragile economy. Yet despite visible strain, Iran is indicating it can endure a prolonged confrontation. Iran’s military says it’s likely the US-Israel war on the country will resume and it’s "fully prepared for any new adventures or foolishness from the Americans”. The central question now is not whether Iran is hurting, but how long it can sustain that pain before it is forced to change course. Also Read | Iran juggles oil cuts and storage strain to resist US blockade The new American strategy The Trump administration is now calling Operation Epic Fury as Operation Economic Fury. Its approach rests on the familiar premise that sustained economic pressure can compel Iran to concede where diplomacy alone has failed. The latest measures go beyond traditional sanctions, extending to warnings that even third-party shipping companies transiting the Strait of Hormuz could face penalties if they pay toll fees to Iran. This effectively internationalises the pressure campaign and raises the stakes for global shipping and energy markets. Treasury Secretary Scott Bessent has said in a post on X that the Economic Fury campaign has already disrupted "tens of billions of dollars in revenue". Bessent also said that Kharg Island, Iran’s primary oil export terminal, is nearing storage capacity and could soon force production cuts, which he said may cost the regime an additional roughly $170 million per day in lost revenue. A senior administration official told Fox News Digital that Treasury is aggressively expanding "Economic Fury" beyond traditional sanctions by targeting Iran’s ability to generate, move and repatriate funds across oil, banking, cryptocurrency and covert trade networks. The official said Treasury has disrupted billions in projected Iranian oil revenue in recent days alone, including freezing half a billion dollars in regime-linked cryptocurrency, while also escalating pressure on Chinese "teapot" refineries, foreign banks and sanctions-evasion networks facilitating Tehran’s trade. However, economic warfare is rarely decisive in the short term. Iran has spent decades adapting to sanctions, building informal trade networks and developing a resistance economy designed to absorb shocks. Also Read | Iran military official says renewed war with US 'likely' Iran’s economic strain There is little doubt that Iran’s economy is under severe pressure. Axios has reported that the Defense Department estimates Iran has been denied nearly $5 billion in oil revenue because of the US blockade. In total, 31 tankers laden with 53 million barrels of Iranian oil are "stuck in the Gulf" and have a value of at least $4.8 billion. Two ships have been seized by the U.S. Unable to fill oil in new tankers as on-land storage facilities reach capacity, Iran has begun to use older tankers as floating storage. Some tankers are taking "a costlier and longer route to deliver oil to China for fear of U.S. maritime interdiction," officials told Axios. Oil exports remain the backbone of government revenue, and any sustained disruption directly affects the state’s ability to fund subsidies, salaries and military operations. Unemployment has surged amid the ongoing conflict, reflecting both wartime disruptions and structural weaknesses. Inflation, already a chronic problem, is likely worsening as supply chains tighten and currency pressures mount. Iran’s economy was in a dire state even before the conflict. National income per person had fallen from about $8,000 in 2012 to $5,000 in 2024, ravaged by inflation, corruption and sanctions, as per a CNN report. The outlook is even worse. Up to 4.1 million more people could fall into poverty due to the conflict, according to the United Nations Development Programme (UNDP). The physical damage caused by thousands of airstrikes has caused widespread displacement, according to the UNDP. More than 23,000 factories and firms have been hit, media outlet EcoIran has reported. That’s cost one million jobs directly, says Iran’s Deputy Work and Social Security Minister, Gholamhossein Mohammadi. And the spillover has pushed another million people out of work, the Iranian publication Etemad Online has estimated. The annual inflation rate in March reached 72%, but was much higher for essentials, according to official data. Miad Maleki, a former Treasury sanctions analyst, argues that the US may now hold its greatest leverage over Iran since the 1979 revolution. "We’ve never had the level of leverage that we have today with Iran in the history of our conflict … since 1979," Maleki told Fox New Digital. For Maleki, what makes this moment different is not sanctions alone, but the convergence of sanctions, naval blockade and aggressive secondary enforcement. He said Iran’s already fragile economy — marked by 104% food inflation and a roughly 90% collapse in purchasing power — could face roughly $435 million in daily economic losses if maritime restrictions hold. Before the conflict, Iran exported roughly 2 million barrels of oil per day, Court Smith, Kpler’s head of engagements and partnerships, told Lauren Simonetti at FOX Business, but current exports appear closer to 1 million barrels daily, leaving an estimated 1 million barrels per day accumulating in storage. Smith estimated Iran may have roughly 30 days before shoreside storage faces severe capacity constraints under current conditions, while warning that older fields or marginal wells could already be facing early shut-in pressures. Why Iran may hold out longer than expected Despite visible economic damage, several factors suggest Iran could endure longer than the US anticipates. Economic distress may not automatically translate into political capitulation. Iran’s leadership has historically shown a high tolerance for domestic hardship, often prioritizing strategic objectives over economic relief. Iran’s political system is structured to withstand external pressure. Power is concentrated among institutions that are less sensitive to public dissatisfaction than democratic governments. This reduces the immediate risk of internal collapse even as economic conditions worsen. Also, Iran has experience operating under sanctions. It has developed alternative trade channels, including barter arrangements and covert oil sales. While less efficient, these mechanisms provide enough revenue to sustain basic state functions. The global context matters too. Rising energy prices and inflation are already affecting countries far beyond the conflict zone. This creates indirect pressure on the US and its allies, potentially weakening the resolve to maintain a prolonged blockade. Danny Citrinowicz, a nonresident fellow with the Atlantic Council’s Middle East Programs, told Fox News Digital: "The blockade won’t force Iran to capitulate." "This country is under sanctions since 1979 … they know how to make adjustments," he added. Alireza Nader, an Iranian independent analyst based in Washington, told Fox News Digital that economic pressure alone will not force a strategic breaking point, arguing that Iran’s leadership has repeatedly shown it is willing to let ordinary citizens bear extraordinary suffering to preserve power. "The regime cares about staying in power," he said, warning that public hardship does not necessarily translate into vulnerability. "The regime isn't just dependent on oil and energy exports to survive, it has other means of income," Nader argued, "Oil and natural gas are its biggest sources of income, but I think this regime has made a calculation that it can withstand even months of economic siege because it may think that the Trump administration is more vulnerable to political pressure." "Look," he added, "American voters vote in the president and vote out the president. In Iran, nobody's voted in and out. The regime maintains power through brutal force. If there are public disturbances, if there are new uprisings, the regime will try to deal with them as it has in the past to mass violence, killing thousands of people. That's how this regime stays in power." Citrinowicz warned that Iran may escalate regionally or exploit global energy vulnerabilities long before economic collapse forces surrender, potentially driving oil prices sharply upward and creating international political pressure before Tehran truly breaks. While the US holds significant economic leverage, its strategy is not without risks. Trump’s own comments that the US might be “better off” without a deal suggest a willingness to prolong the standoff, but time cuts both ways. The blockade may take weeks or longer to exert maximum pressure. Even then, its effectiveness depends on enforcement and international cooperation. If other countries find ways to bypass restrictions, the impact could be diluted. The current situation points toward a protracted impasse rather than a rapid resolution. Both sides are showing endurance. They may tolerate this deadlock even as the rest of the world bears the economic fallout. 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