On 24 August, the Trump administration launched an operation called “Economic Outcast”, describing it as the largest economic offensive ever undertaken against Iran’s financial links around the world, aimed at cutting off every potential source of revenue that funds the country, and as more forceful than any such campaign the United States has previously launched against its adversaries. This operation threatens any party dealing with the Iranian regime with direct confrontation with the United States. Washington is returning to the use of an economic blockade against Iran after failing to achieve the outcomes it sought from the war it launched against the country. The blockade was tested during Donald Trump’s first term and inflicted damage on Iran, but failed to achieve its intended objectives. This American approach reflects another failure for the United States resulting from the war, after the terms of the agreement Washington reached with Iran several months ago reflected a defeat for Washington, from which it subsequently withdrew. Nor is this operation expected to succeed. China and Qatar, immediately after Washington announced the blockade, declared that they had no intention of complying with illegal, unilateral sanctions. The question, then, is whether the United States can today determine the outcome of the war by economically blockading Iran, in a regional and international environment more complex than the one that prevailed during Trump’s first term.

Although ceasefires have been put into effect more than once through Pakistani mediation, most recently through a memorandum of understanding concluded last June, this has not brought an end to the tensions and confrontation between the two sides in the war initially launched by the US and Israel against Iran. Six months into the war, despite Trump’s statement at its outset that it would last no more than four or five weeks at most, and despite the United States’ military superiority, the war has failed to resolve the issues surrounding Iran’s nuclear programme, the development of its ballistic missile system, and Iran’s regional footprint. Instead, the war has added a new issue: the Strait of Hormuz. The United States has recently turned to the economic blockade against Iran, having previously resorted to this option following Washington’s withdrawal from the nuclear agreement in 2018. The US sanctions, imposed as part of the maximum pressure campaign, inflicted damage on Iran, but failed to destroy the Iranian economy or reduce its oil exports to zero, and did not achieve the objectives for which they had been imposed. The international and regional environment at the time helped Trump implement that sanctions campaign, but that environment has changed today. Over time, those sanctions also helped Iran develop an extensive system for circumventing them, relying on intermediaries in a number of countries and on complex, interconnected financial, commercial and oil networks.

Iran has therefore become highly experienced in containing sanctions. China represents a key factor in limiting the effectiveness........

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