More than 23 weeks into the war on Iran, United States President Donald Trump has signalled he would rather rely on squeezing Tehran’s economy than returning to a military offensive, as he had warned he might last week. This strategic pivot marks a significant departure from his previous rhetoric, where he had given the “duplicitous” Iranian leadership “one last chance” to reach a deal or face catastrophic military strikes. Now, Trump says he prefers to target Iran’s economic foundations instead.
Shipping through the Strait of Hormuz, the critical waterway central to ongoing negotiations, remains disrupted by Iranian forces as a US naval blockade continues to tighten. While Iran and Oman have indicated they are close to reaching an agreement on the management of the strait, Trump clarified that the US is “only semi-negotiating” with Tehran. Meanwhile, the administration is adopting a more restrained posture, with Trump telling the news website Axios on Sunday, “We are low-keying it.”
The President argued that Iran is currently in “very bad shape” financially. He pointed to high inflation rates and the regime’s reported difficulty in paying its own soldiers as evidence that the strategy is working. Trump credited the US naval blockade, which has been in place since April, with significantly increasing this pressure. “We are just watching Iran with its huge inflation and the fact they have no money,” he stated.
Trump also claimed that the recent decline in oil prices, which were trading at approximately $78 a barrel on Monday, has effectively eased the economic burden on US consumers. This is a notable shift from earlier in the conflict, when the closure of the Strait of Hormuz had sent global oil prices surging above $100 a barrel for a period. He remains confident in the long-term efficacy of his approach, noting, “It will work out. It always works out. It’s like a chess game.”
Vice President JD Vance echoed this sentiment on Saturday, telling Fox News that the administration is utilizing a comprehensive array of diplomatic, economic, and military tools to secure the best outcome for the American people. The primary objective remains the reduction of Iran’s oil exports, which are estimated at approximately 1.5 million barrels per day, to significantly diminish the regime’s revenue streams.
The US military’s Central Command (CENTCOM) reported on Saturday that it had redirected 53 commercial vessels, boarded two, and disabled two others as part of its enforcement efforts. Trump described this ongoing operation as an unyielding “wall of steel.” Iranian authorities have attested to near-zero crude exports as a result of the blockade. These oil export constraints are compounding Iran’s existing economic woes, which are already linked to domestic structural issues, mismanagement, and years of harsh international sanctions.
The conflict, which began on February 28 following the death of Iranian Supreme Leader Ali Khamenei, has seen the US and Israel frequently shift their strategic goals. Initially, the war was framed as a mission to prevent Iran from developing nuclear weapons—a pursuit Tehran has consistently denied—and to force a change in government. Trump has since quietly dropped the objective of regime change.
A memorandum of understanding (MoU) signed on June 17 to reopen the Strait of Hormuz and initiate a 60-day negotiation period collapsed within days, primarily due to disagreements over the management of the waterway. Furthermore, Iran’s domestic infrastructure has suffered extensive damage throughout the conflict, leading Tehran to demand compensation from the US for the destruction.
Despite the shift to economic pressure, questions remain regarding the effectiveness of these tactics. Mehran Kamrava, a political analyst, expressed skepticism, noting that Iran’s leaders are not under the same internal political pressures as the Trump administration. “It’s not that people making decisions directly care about the plight of the middle classes,” Kamrava said. “They want to stay in power, so I’m not sure if this tactic is going to work at this point.”
Logistical challenges also persist. Several media reports have suggested that Washington is running low on munition stockpiles due to the dual demands of the conflicts in the Middle East and Ukraine. Axios reported late last month that the chairman of the US Joint Chiefs of Staff, General Dan Caine, had cautioned Defense Secretary Pete Hegseth that a prolonged military campaign could strain US resources.
In response to these concerns, the Pentagon has requested that the US defense industry rapidly escalate the production of munitions currently in short supply. However, a Pentagon official told Al Jazeera on Saturday that the US maintains sufficient stockpiles to sustain its current operations. Jarred Conley, the Deputy Director of Maritime at the Defense Innovation Unit, stated, “We have sufficient munitions for the task at hand.”
The current strategy represents a complex balancing act for the White House. Having entered his second term promising to avoid “stupid wars,” Trump is now attempting to navigate a path that exerts maximum pressure on Tehran while managing the domestic economic fallout and the limitations of the US military supply chain.
“The department has everything it needs today to execute a war.”
Only about 35 percent of Americans approve of the war, a recent Reuters/Ipsos poll suggested.
Asked which political party has a better approach to handling war and “terrorism”, registered voters picked Democrats over Republicans – 37 percent to 36 percent.
Currently, his war on Iran is unpopular in the US, where the president and his fellow Republicans are seeking to defend their narrow congressional majorities in November’s midterm elections.
This is the first time Democrats have led since Reuters/Ipsos polling began posing the question in December 2024 when Republicans led 39 percent to Democrats’ 28 percent.
Mehran Kamrava, professor at Georgetown University in Qatar, said negotiations between Iran and the US are progressing very slowly and cast doubt on whether Washington’s economic pressure campaign would succeed.
He noted that Iran has been able to exert considerable pressure on Gulf countries where US military assets and infrastructure are located by attacking them with missiles and drones.
“What we have seen is that the Iranians are trying to put economic pressure on the regional neighbours, particularly on countries like Qatar, UAE, Saudi Arabia and Kuwait, so that they would in turn put pressure on the US to negotiate with Iran,” he said.
… So neither side is willing to take that first step and extend an arm and say, ‘Let’s sit down and negotiate,’” he said.
The US also made other demands, including restricting Iran’s ballistic missiles programme and ending its support for Iran-aligned armed groups around the region, such as Hezbollah in Lebanon, the Houthis in Yemen and others in Iraq and Syria.
While the MoU did mention the eventual lifting of US sanctions on Iran and a reconstruction fund for Iran, it did not specifically cover US demands about Iran’s ballistic missile programme or regional armed proxy groups.