U.S. Officials Say Sanctions Hurt Iran More Than Bombing
U.S. officials believe that sanctions may harm Iran more than airstrikes. This judgment is based on past experiences: the U.S. Treasury and State Department have long targeted Iran's oil, banking, and cross-border settlement networks through secondary sanctions. Market transmission is more direct, with buying shifting to alternative channels with lower compliance costs, while selling concentrates on Iranian energy, shipping, and intermediaries constrained by secondary sanctions. These types of strikes typically do not destroy production capacity but rather increase transaction friction, cut off dollar clearing and third-party financing, forcing Iran to prioritize cash flow for maintaining imports and internal stability.
Source: Public Information
ABAB AI Insight
The U.S. sanctions system against Iran is not a temporary tool but a long-term structure that has gradually accumulated since the 1979 hostage crisis. In 2025, the State Department continues to link "maximum pressure" with energy smuggling, financial networks, and third-country entities, indicating that the sanctions' goals have expanded from mere diplomatic punishment to systematically cutting off foreign exchange and settlement channels.
In terms of capital pathways, sanctions truly target the gap between "visible cash flow" and "settleable cash flow." Even if Iran can still sell oil, as long as freight, insurance, agency, banking, and payment routes are layered with increased costs, the actual funds received will significantly shrink, and the national fiscal maneuverability will be forced into higher-cost alternative networks.
Historically, this structure resembles repeated pressure on Venezuela, certain entities in Russia, and Iran itself after 2018: it does not immediately destroy the regime but raises prices on foreign exchange, imports, financing, and technology procurement. Compared to airstrikes, the advantage of sanctions lies in their sustainability, scalability, and spillover effects, especially through third-country banks and traders amplifying deterrence.
Essentially, this is a regulatory change, but its effect is akin to a financial blockade. Airstrikes change the status of facilities, while sanctions alter funding pathways; when the latter can continuously block trade settlements, insurance, and financing, the impact is often deeper and longer-lasting than a one-time strike.
ABAB News · Cognitive Laws
- Destroying factories is easy; cutting off cash is harsher.
- The strongest sanctions are not trade bans but increased friction.
- Once cash flow is cut off, the first to collapse is the structure, not the slogans.