Trump Vows Tougher Economic Measures on Iran and allies
Donald Trump said, "We are going to see what happens, it will either be extremely good and oil prices are going to drop like a rock or we will continue to do exactly what we are doing. You know they were talking about oil at $350 a barrel and today it's at $84, $85."
At the height of the oil price, Brent Crude showed resistance on the chart at $115 ish and WTI (West Texas Intermediate) at around $105 a barrel.
Consumer demand can be damaged at a certain price. For example, people might decide to take only one trip to the shop and do all their shopping in one go rather than doing it daily, or visit a family member only twice a week rather than three times. Companies will also take different measures with logistics.
US Maximum Pressure & Escalation
Sanctions Expansion: The US administration announced an intensified "maximum pressure" campaign against Tehran. Treasury Secretary Scott Bessent confirmed that new, severe economic measures targeting Iran and its international commercial partners will be formally unveiled on August 24.
Global Ultimatum: President Trump warned foreign nations that any institutions, ports, or businesses offering an economic "lifeline" to Iran will face punitive US sanctions.
Regional Financial & Military Shifts
UAE Trade Cutoff: The United Arab Emirates officially suspended all trade and financial dealings with Iran following recent Iranian missile attacks aimed at maritime targets near the Emirati coast.
Strait of Hormuz Gridlock: Iran’s Central Bank Governor acknowledged that the country is currently unable to export oil due to naval blockades and severe foreign currency shortages. In response, Tehran is threatening to shift toward an "offensive posture" in the Strait of Hormuz.
Proxy Activity: Houthi forces in Yemen claimed responsibility for drone strikes against oil facilities and regional infrastructure in Najran, Saudi Arabia, citing retaliatory actions against regional overflights.
President Donald Trump has made an imminent threat to nations doing any kind of trade with Iran, threatening tough economic sanctions as a punishment. With the dollar being the world's means of trade, sanctions can be economically isolating, but can nations get around these sanctions in different ways as we know has been done?
Trump also mentioned, "People have found other alternatives: Texas, Alaska, Louisiana, and other places. Addition and other places, record numbers of pipelines are being built, so erm I think the Hormuz Strait is not going to be as important as it was in the past."
So with a push for US oil, and his encouragement to the UK to open back up the North Sea for drilling oil—which Prime Minister Andy Burnham has gone along with despite potential backlash from climate change—is the US pushing for more Western oil independence, and does that give Iran less bargaining power?