DUBAI, United Arab Emirates — Iran’s currency reached a record low on Monday as the United States prepared to unveil additional sanctions, which Washington described as an “economic D-Day” aimed at intensifying pressure on an economy already strained by prior measures and ongoing conflict.
The rial fell to 2.02 million against the U.S. dollar at the opening of informal currency markets. While Iran’s Central Bank maintained an official exchange rate of approximately 1.5 million rial per dollar, most citizens rely on the informal market rate for daily transactions.
The currency had been weakening even before the February 28 conflict between the U.S. and Israel, grappling with soaring inflation and contracting economic output. However, nearly six months of warfare has exacerbated its decline, pushing it to unprecedented lows.
Despite efforts by U.S. President Donald Trump to extract concessions from Iran, Tehran continues to assert control over maritime passage through the strategic Strait of Hormuz—a vital route for roughly one-fifth of global oil trade prior to the conflict. Iranian military actions and threats have significantly disrupted this crucial waterway during the ongoing war.
Iran and Oman, situated across the strait, are reportedly nearing a bilateral agreement on jointly managing the waterway, according to regional officials. The proposed framework would allow vessels to enter the Persian Gulf via an Iranian-controlled corridor and depart through an Omani-administered channel.
President Trump has openly criticized Oman, a traditional U.S. ally, warning that he would consider bombing the nation if it interferes with American objectives in the region.
In a bid to break the stalemate, U.S. Treasury Secretary Scott Bessent pledged on Sunday that even harsher sanctions than currently exist would be implemented, including secondary penalties targeting countries that maintain economic ties with Iran.
“President Trump decimated Iran’s economy to a point where the rial has never been weaker and inflation has rarely been higher,” Bessent wrote in an op-ed for the Financial Times. “The regime’s last line of defense now rests in the self-deception of fearful nations that still believe yielding to aggression can ensure lasting peace.”
Last week, the United Arab Emirates declared it would suspend all trade relations with Iran—a move that came shortly after President Trump spoke with UAE Crown Prince Sheikh Mohammed bin Zayed Al Nahyan.
The UAE has historically served as one of Iran’s primary trading partners, functioning as its largest source of imports as well as a central re-export and financial hub for Iranian commercial activity.
In response to these developments, Mohsen Rezaei—a prominent conservative figureheading Iran’s Supreme National Security Council—warned on social media platform X that any nation endorsing new U.S.-led economic penalties would be viewed as committing an “act of war.”
