US Sanctions Iran Military Supply Network as rial Hits Record Low

The United States on Tuesday imposed sanctions on individuals and companies accused of acting as financial facilitators for Iran's military supply chain, extending an economic pressure campaign against Tehran at a time when the future of renewed diplomacy between the two countries remains unclear.

The action, taken by the Treasury Department, falls under an initiative called Operation Economic Outcast, which US officials describe as an effort to cut off what they call critical financial lifelines for the Iranian government, already subject to extensive sanctions.

"Treasury will not tolerate any support to the regime and will continue to identify, expose, and isolate Iran's enablers," Treasury Secretary Scott Bessent said in a statement.

Ten individuals and entities based in Iran, Hong Kong and Pakistan were designated for allegedly procuring weapons and weapons components for Iran's defense ministry. US officials have said the measures are intended to disrupt Iran's defense systems, weaken the government's capacity to rebuild its weapons program, and raise the cost for those assisting Iranian military procurement.

The move follows similar designations in 2024, when the Biden administration targeted entities supporting Iran's Ministry of Defense and Armed Forces Logistics in the production and spread of missiles and drones.

The sanctions came as Iran's currency fell to a record low, with traders in Tehran exchanging more than 2.5 million rials to the US dollar. The rial has declined steadily since the war began on Feb. 28, having previously touched a record low of 2.2 million to the dollar on Sept. 2.

Iran's economy has been under strain for years because of international sanctions, but a US naval blockade on Iranian oil this year and fresh penalties imposed since the war began have pushed it into an unprecedented freefall.