Trump posted on Truth Social and announced what he himself called “THE MOST DEVASTATING ECONOMIC OPERATION EVER CONDUCTED AGAINST A COUNTRY.” And he didn’t stop there. **
He called it ECONOMIC D-DAY, an economic landing, and said that Iran is “hanging by a thread.”**
At the same time, however, a former adviser to Iran’s Central Bank went on CNBC and said something completely different. That the shelves are full and that nothing is collapsing.
Two completely opposite pictures of the exact same economy.
The message was clear. “It will be Economic Warfare and Isolation on an unprecedented scale,” he wrote.
And here is the critical part. Trump didn’t just threaten Iran. He threatened every country that would give it a lifeline. Any country whose banks, businesses, airports, or government entities help Tehran will also face massive economic consequences.
He even named the channels he wants shut down immediately. Oil smuggling. Currency swap lines. Cash transfers. Foreign exchange offices. Ship registries. Front companies.
“All of this must stop NOW. You know who you are,” he said.
“You might be wondering, Christos, is this really something new?” Not entirely. It is the continuation of a campaign that has been running since April under the name Operation Economic Fury. It’s just being taken to another level now.
Trump claims that Iran’s navy, air force, and military production facilities have been destroyed, that its currency has become worthless, and that the country is “on the ropes.”
And this is where things get even more interesting. Because the numbers really are frightening.
Inflation in Iran reached 62.2%. And food prices? Yes, you read that correctly. 99%. That means food prices have nearly doubled in one year.
The rial has collapsed. On the black market, you need roughly 1.85 million rials for one dollar. Five years ago, 50,000 rials were enough.
The war has cost roughly one million jobs. The economy contracted 2.7%, and this year the estimate is around -5%. Oil exports have essentially fallen to zero, meaning the government has no revenue to pay salaries. And what does it do? It prints money, which fuels inflation even further.
Of course, there is a big “but.”
Mehrdad Sepahvand, a former adviser to the Central Bank, says we need to be careful with the collapse narrative. Stores have food. There is no panic in the markets. And despite cyberattacks and imbalances in the banking system, there has been no mass run on the banks.
There is another factor too: geography. Iran has 5,500 kilometers of borders with seven countries, has access to the Caspian Sea opposite Russia, and is building rail connections to bypass the naval blockade. You cannot easily seal off a border like that.
The real blow came from somewhere else. The UAE cut all commercial and economic ties with Tehran. And we’re talking about the country that accounted for more than 30% of Iran’s imports. Iraq appears to be following suit.
And this is exactly where the biggest player enters the game. Because this whole story ultimately runs through Beijing.
China buys more than 90% of Iran’s oil exports. Trump did not name any country in his post. He didn’t need to.
The response came immediately. “Sanctions and pressure will not help resolve the issue,” said Chinese Foreign Ministry spokesman Lin Jian, calling for a diplomatic solution.
You might ask: will China comply?
Officially, no. Beijing does not recognize unilateral sanctions, and in May it explicitly instructed its companies not to comply with them.
In practice, however, major Chinese banks have a history of complying. Why? Because they fear losing access to the dollar clearing system.
And pay attention to something very important. The United States has targeted some small Chinese refineries, but it has not yet gone after the major Chinese banks financing the trade.
And all of this is happening just one month before the Trump-Xi meeting.
Now we get to the most interesting part. Why did Trump choose this path?
To understand that, let’s look at what other options were on the table.
First, admit defeat and accept Iran’s terms.
Second, launch more airstrikes, hoping for a different outcome.
Third, a ground invasion. Exactly the kind of endless Middle East war he had promised to avoid.
Put side by side, economic strangulation is the least bad option.
Of course, “least bad” is a long way from “good.”
And here history reminds us of something.
Iraq. Venezuela. Cuba.
In all three cases, the currency became worthless, inflation exploded, and unemployment soared. And do you know what sanctions alone achieved politically? Nothing.
The key now is oil.
Brent is at $93 and WTI at $86. As long as oil remains below $100, Trump has time. And so far, the Strait of Hormuz is helping, but with very low traffic. In the week ending August 16, there were 73 crossings, down from 91 the previous week.
