U.S. Treasury Secretary Scott Bessent said Iran is shipping no oil cargoes as its currency weakens, warning that the country's economy could shrink massively within one year.

Bessent, in an interview with CNBC on Wednesday, said Iran had no oil barrels on the water, although some crude remained in storage behind the blockade. He also said the rial had declined sharply as the blockade restricted access to foreign currency. Bessent said Iran's currency has collapsed so severely that authorities may arrest people for printing banknotes with denominations as high as 3 million rials.

"Probably for the first time since Iran started producing oil, they have no barrels of oil on the water," Bessent said.

The Treasury secretary called the Operation Economic Outcast "the toughest operation ever to isolate a single economy in the history of the world," adding that it began about eight weeks earlier.

"We have internal estimates that show that the economy from March to March, when the blockade started or the conflict started, March to March, the economy may contract by as much as 25%," he said.

Bessent said Iran's elected officials and the Islamic Revolutionary Guard Corps (IRGC) were increasingly concerned and discussing the possibility of a "collapse," both publicly and privately. He said the regime could not pay troops or secure dollars. He added that financial support for Iran-backed groups, including the Houthis, Hamas and Hezbollah, was declining as Tehran's available resources contracted under the blockade.

"Part of my worry is that many of the IRGC members are…They are afraid for their lives. So they're…bunkered down," said the Treasury Secretary. He said the pressure on Iran's leadership could make its officials less aware of the situation unfolding around them.

Iran's Economic Strains Deepen Amid Blockade

The warning follows an earlier deterioration in Iran's currency and economic outlook. Earlier this month, national security adviser Mohsen Rezaei reportedly told President Masoud Pezeshkian and senior ministers that the country faced one of its most difficult periods.

The rial's record-low decline was linked to intensifying sanctions pressure, adding domestic economic strain before Bessent described the blockade's broader effects.

Meanwhile, Bessent said that Iranian efforts to disrupt energy shipments had failed, while oil flows from the Persian Gulf had recovered and surpassed pre-conflict levels. He also shared a chart based on Treasury Department data showing that roughly 17–18 million barrels of oil were moving out of the region daily by the end of September.

Despite the surge in oil shipments, RBC Capital Markets' Head of Global Commodity Strategy, Helima Croft, said the movement was supported by a massive U.S. naval deployment in the region, warning that such a presence was unsustainable over the long term.

At the time of writing, Brent Oil Futures dated January 2027 was trading 0.72% lower at $110.94 per barrel, while WTI crude oil futures dated December 2026 declined 1.20% to trade at $101.54 per barrel.