US announces Iran economic D-Day against Iran; Brent had reached $94.39 before that
On August 24, the United States announced an economic campaign against Iran, which President Donald Trump called Iran economic D-Day. According to him, it is also intended to target countries that assist Tehran, including by purchasing Iranian oil. As The Rio Times reports, as of August 24, no formal document on the new sanctions had been published, so the package had not yet entered into legal force.
US Treasury Secretary Scott Bessent promised to introduce the harshest sanctions in history, while details of the measures are to be announced later. The publication notes that potential secondary sanctions could create risks for banks, shipping companies and traders doing business with Iran.
Oil prices
Brent closed at $93.78 per barrel on August 20, gaining 2.36%. The following day, the price rose by another 0.65% to $94.39 per barrel. On Monday, August 24, Brent declined to approximately $93.17, or by 1.29%.
According to The Rio Times, oil prices rose during the week before Washington's announcement and fell somewhat on August 24. The market is awaiting specific US legal decisions and Iran's further actions.
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The Strait of Hormuz and the rial
An Iranian authority blacklisted 45 tankers, warning of possible fines and confiscation. Separately, Iranian officials stated that if the economic war continues, all oil supplies from the Persian Gulf could be blocked, according to them. There is no official order to close the Strait of Hormuz.
About 20% of global oil supplies pass through the Strait of Hormuz. The Iranian rial fell on the unofficial market to approximately 2.02 million rials per dollar, which the publication calls a record low. The official exchange rate of the Central Bank of Iran was about 1.5 million rials per dollar.
Higher oil prices could increase the revenues of exporters in Latin America, including Brazil, Colombia and Guyana. At the same time, oil importers in Central America and the Caribbean may face higher fuel costs and inflationary pressure.
