US hits 27 Iranian airlines with latest sanctions

WASHINGTON — The Treasury Department announced sanctions targeting Iran’s airline industry on Tuesday, part of an ongoing effort to squeeze the Iranian economy after six months of war. 

The department designated 27 Iranian airlines not yet subject to US sanctions and tightened pressure on the previously sanctioned Mahan Air, a private airline it said the Islamic Revolutionary Guard Corps has used to transport weapons and military personnel. 

“Essentially, we're taking the entire aviation sector of the Iranian economy out of the market,” said a Treasury official briefing reporters on condition of anonymity. 

Nine private entities based in Turkey, Malaysia, Kazakhstan and the United Arab Emirates were hit with sanctions for allegedly helping Mahan Air obtain US-origin aircraft and sensitive technology. According to the Treasury Department, the Iranian carrier received at least three Boeing 777 aircraft this summer as part of a scheme that diverted the planes through the UAE and Oman.

“These jurisdictions have been unnoticed for some time, and now we're moving quite directly to essentially cut off those operators from the Western financial system,” the official said. 

The Treasury Department also suspended three general licenses that authorized payments for overflights of Iranian airspace and for non-American airlines to fly US-origin aircraft into Iran.

The Treasury official said Iran’s weakened currency, which reached a record low of 2.25 million rials per US dollar on Saturday, shows the sanctions and naval blockade are working. Since announcing the start of Operation Economic Outcast on Aug. 24, the Treasury Department has targeted a small Turkish investment bank and the United Arab Emirates-based branches of an Egyptian bank accused of processing transactions for Iran’s IRGC and shadow banking networks. 

The department has yet to blacklist major financial institutions in China, Iran’s largest trading partner and purchaser of its oil. Sanctions could jeopardize a fragile detente ahead of a meeting between President Donald Trump and his Chinese counterpart, Xi Jinping, in Washington later this month.

Brett Erickson, managing principal of Obsidian Risk Advisors, told Al-Monitor that Tuesday’s measures are an attempt to create a sanctions-enforced air blockade. 

“This is a far more significant escalation of Operation Economic Outcast,” Erickson said. “These sanctions seek to restrict Iran’s ability to import and export goods by air across the board, not simply move weapons or personnel.”

Brent, the international benchmark for oil, reached a seven-week high of $99 per barrel on Tuesday morning following attacks by the Iran-backed Houthis on energy facilities in southern Saudi Arabia. On Monday, Trump insisted oil prices “will drop precipitously” once the US wins the war.

This developing story has been updated since initial publication.