Trump warns Iran of ‘very Draconian sanctions’, downplays Strait of Hormuz’s importance
By R Anil Kumar
Washington/Bengaluru, August 19, 2026. US President Donald Trump has warned that Iran could face “very Draconian sanctions” while downplaying the future strategic importance of the Strait of Hormuz, saying increased US energy production and alternative supply routes have reduced global dependence on the key waterway.
“We have things that we could sanction. We have very Draconian sanctions, and we’ll see what happens,” Trump said at the White House when asked about possible new measures against Tehran.
Trump said vessels were continuing to move through the Strait of Hormuz, which links the Persian Gulf with the Arabian Sea and is a major route for global energy shipments.
“Right now, the Strait is open; we’ve got a lot of boats coming through, people aren’t reporting that,” he said, adding that traffic could slow at some point.
Trump also claimed that a US naval blockade against Iran had prevented ships from reaching the country, though he did not provide figures to support the claim.
“The naval blockade has been extremely effective,” he said. “No boats have gotten into Iran, but they are getting in for other places.”
The President said there had been brief pauses in the operation under an agreement but accused Iran of failing to honour its commitments.
“The deal didn’t terminate — you know, the deal didn’t turn out to be what they said,” Trump said.
Trump framed the administration’s next steps as a choice between reaching an agreement that could push oil prices lower and continuing with the existing US strategy.
“It’ll either be extremely good, and oil prices are going to drop like a rock, or we’ll continue to do exactly what we’re doing,” he said.
He also pointed to the absence of the sharp rise in oil prices that had been forecast amid tensions, saying prices were currently around $84-$85 a barrel.
“You know, they were talking about $350 a barrel, and it’s today $84 or $85. And we are getting a lot of oil out,” Trump said.
He attributed the relatively stable oil prices partly to increased US energy production and the development of alternative supply infrastructure.
“But the other thing that’s happened is people have found other alternatives, which they never thought about, Texas, Alaska, Louisiana and other places,” he said, adding that “record numbers of pipelines” were being built.
Trump said these developments could reduce the Strait of Hormuz’s importance to global energy markets.
“So, I think the Hormuz Strait is not going to be quite as important as it was in the past,” he said.
His remarks came during a White House event with leaders from the finance, cryptocurrency and technology sectors. He was responding to a question about a statement by the Treasury Secretary that the administration could announce its most consequential sanctions against Iran during the week.
Trump warns of economic consequences for any country that supports Iran
US President Donald Trump warned of economic consequences against any country that provided “any type of lifeline to Iran” as the US looks to resolve a war it began alongside Israel nearly six months ago.
Thousands of people have been killed in the war, which quickly drew in countries across the Gulf, and global markets have been shocked as Iran flexed its ability to control shipping through the Strait of Hormuz, through which about a fifth of the world’s traded oil passed before February.
The US and Iran have twice announced ceasefire agreements, in April and June, designed to restore the free flow of shipping through Hormuz to pre-war levels on the way towards ending the conflict, but both quickly crumbled even as Israel has largely withdrawn from the fighting.
In a message posted on social media on Wednesday evening, Trump promised “Economic Warfare and Isolation on an unprecedented scale,” although details were scant. Iran has weathered continuous punishing economic sanctions for nearly 50 years, since the Islamic Revolution of 1979.
“ANY country that allows its financial institutions, businesses, airports, or government entities to provide any type of lifeline to Iran will itself face TREMENDOUS Economic Consequences,” Trump wrote.
Trump’s social media threats and announcements do not always get fleshed out or successfully acted upon as written, and he did not specify what specific steps the US would take against such a country, which would appear to include US allies that have helped mediate peace talks, and he did not list any country by name.
On Tuesday, the United Arab Emirates, which hosts a major US military base, announced it was suspending all trade activities, commercial exchanges and financial transactions with Iran until further notice. The announcement came after the UAE defense ministry said it had detected two missiles launched from Iran that fell into the sea, a report Iran dismissed as baseless.
China buys more than 80% of Iran’s shipped oil, according to 2025 data from analytics firm Kpler, but for the US to engage in further economic warfare with China, a major exporter to the US including of vital rare-earth minerals, risks retaliation.
Iran remains open to dialogue with the US but does not confuse negotiations with surrender, Mohammad Mokhber, an adviser to Iran’s supreme leader, said on Tuesday, according to the semi-official Fars news agency. Mokhber said military pressure and sanctions would not break Iran’s resolve.
On Tuesday, Trump said no talks were taking place with Iran. A day earlier, Jared Kushner, Trump’s son-in-law and special envoy, struck an upbeat tone, saying talks with Iran were still underway and were “probably more robust” than ever.
Trump wants to seize Iran’s stockpile of highly enriched uranium and is seeking a new, more restrictive agreement curbing Iran’s nuclear energy and research programs, to replace the one he unilaterally withdrew the US from in 2018. Iran, a non-proliferation treaty signatory, has for decades said its nuclear programs are peaceful.
