'You are either with us or against us': Bessent warns allies over Iran sanctions

WASHINGTON, DC: Treasury Secretary Scott Bessent warned US allies that they must choose between Washington and Tehran as the Trump administration prepares tougher Iran sanctions.

He made the comments on Thursday, August 20, in an exclusive CNBC interview, hours after President Donald Trump called for allies to isolate Iran.

Scott Bessent puts allies on notice

Bessent previewed the administration's sanctions plan by telling US allies, "You are either with us or against us," as Washington prepares what he described as unprecedented economic pressure on Iran.

"If you insist on doing business with [Iran], either transferring money, buying their oil, or doing seaborne ship transfers, then the US Treasury and the US government... will put its full might and force toward enforcing against you," Bessent said.

He said the United States would seek "the greatest coordinated economic isolation in the history of the world" against Iran and announced plans to hold a press conference on Monday to explain the measures.

"It is time for our allies and the rest of the world to make a decision," Bessent said. "We are going to squash the economy of this regime."

That warning raises the stakes for any country still doing business with Tehran.

Trump calls for economic isolation

Trump had already signaled the administration's approach on Wednesday evening, saying the United States would impose major economic penalties on any country providing "any type of lifeline" to Tehran.

"This will be an ECONOMIC D-DAY, and we need all of our Allies to stand with the United States of America to isolate, and defeat, the Iran threat," Trump wrote on Truth Social.

Bessent said the economic campaign would operate alongside an ongoing US Naval blockade of Iranian ports in the Gulf of Oman.

"It is a one-two punch. We have the blockade, and we are going to have the toughest sanctions in history," he said.

He also argued that maximum economic pressure could reduce the need for renewed major US military operations against Iran.

"If we are doing the maximum economic pressure, then that means that likely there will not be a large-scale kinetic restart," Bessent said.

Iran's economy faces pressure

The administration's economic push comes as the war against Iran approaches the six-month mark, with CNBC reporting that the United States has not shown signs of securing either a diplomatic or military victory.

Trump has repeatedly claimed the United States has effectively destroyed Iran's military and economy. 

In his Wednesday post, he said Tehran was "on the ropes" and "hanging by a thread."

Iran's GDP is believed to have contracted during the war, while inflation has reached historic highs. 

But some experts urged caution against assuming the economy is facing imminent collapse, the outlet reported.

Iran also retains the ability to disrupt the Strait of Hormuz, where 20% of the world's oil trade occurred before the war.

Tanker crossings remain highly diminished, while the United Arab Emirates said on Wednesday that it would halt all trade with Iran after new ballistic missile strikes.

Bessent said the administration would use the full force of its economic enforcement against countries that continue doing business with Tehran, adding, "We are going to collapse this regime."