Trump sanctions 27 Iranian airlines as oil surges to $100

Donald Trump’s administration sanctioned 27 Iranian airlines Tuesday as oil edged closer to $100 a barrel. The Treasury Department targeted several related entities as Washington tries to squeeze Iran out of the global financial system.

The move is part of “Operation Economic Outcast” and covers every Iranian airline that had not already been sanctioned.

Treasury Secretary Scott Bessent warned anyone still doing business with them. “Let this be a warning to anyone doing business with Iran’s remaining airlines, all of which we sanctioned today: You are at risk of being cut off from the global financial system,” Scott said.

Fighting around the Strait of Hormuz keeps dragging more countries into a war that has lasted more than six months.

Iranian forces and groups backed by Tehran are attacking targets near the key shipping route and elsewhere in the region. Iran can slow ship traffic enough to squeeze oil flows and keep some leverage.

Trump believes that it is the United States and not Iran that has control of the water body. However, his government has been skeptical of ship-tracking data which shows that there is low activity compared to before the war. The conflict escalated further Tuesday after Houthis attacked several oil facilities in Saudi Arabia.

Oil nears $100 as Trump turns up pressure on Iran

Brent crude moved above $99 a barrel, while West Texas Intermediate gained almost 2% at the session high. A huge amount of the world’s oil moves through Hormuz, so fewer ships getting through has tightened supply fears and pushed prices higher.

Washington launched the sanctions push on Aug. 24 and called it Iran’s “Economic D-Day.” At first, there were more warnings than actual penalties. Treasury later targeted the United Arab Emirates branch of an Egyptian bank over its financial ties to Tehran.

Officials followed Friday by sanctioning Turkey’s 35th-largest bank, according to TheBanks.eu. Tuesday’s airline move put a bigger chunk of Iran’s aviation industry under U.S. restrictions.

Energy markets moved higher with oil. The iShares Global Energy ETF (NYSEARCA: IXC) hit its highest level since launching in November 2001 and was last up 1.8%.

State Street (NYSE: STT)’s SPDR S&P Oil & Gas Exploration & Production ETF (NYSEARCA: XOP), which tracks U.S. energy producers, reached its highest level since June 2015 and was last up 2.3%. Global energy stocks also hit a record Tuesday morning as the war kept fuel supplies under pressure.