The United States is preparing to announce a new package of sanctions against Iran on Monday as tensions between Washington and Tehran continue, with both sides issuing fresh warnings and prospects for a diplomatic breakthrough remaining uncertain.

US Treasury Secretary Scott Bessent said details of the measures would be announced on Monday, describing them as potentially the toughest financial sanctions Washington has imposed on Iran.

President Donald Trump has also warned that countries providing an economic “lifeline” to Tehran could face consequences, a move that could extend pressure beyond Iran to some of its major trading partners.

Iran has responded with warnings of its own.

Tehran said any new US threats could trigger a severe response, although senior Iranian officials have also continued to leave open the possibility of diplomacy.

The competing messages come nearly six months into a conflict that has severely disrupted trade and shipping through the Strait of Hormuz, one of the world’s most important energy routes.

China is likely to be closely watched as Washington provides details of the sanctions.

Reuters reports that China purchases around 80 per cent of Iran’s shipped oil exports, making it a critical market for Tehran at a time when its energy revenues are under increasing pressure.

Bessent has urged Beijing to cooperate with the US strategy, while China has opposed unilateral sanctions and argued that diplomacy, rather than further economic restrictions, offers a better route to resolving the crisis.

The pressure is already affecting Iran’s oil trade.

Offers of Iranian crude to Chinese buyers have fallen significantly following tighter US restrictions, according to traders cited by Reuters, while some Chinese refiners have begun searching for alternatives from countries including Iraq and Brazil.

Iranian oil shipments have fallen sharply compared with their 2025 levels, while supplies already stored outside the immediate conflict zone are also declining.

Global crude prices have responded to the uncertainty.

Brent crude settled at $94.39 per barrel on Friday, while US West Texas Intermediate closed at $87.06, as traders assessed the possibility that tougher restrictions could further reduce Iranian supply.

Oil prices had already risen earlier in the week after Trump threatened economic measures against countries continuing to support Iran.

Shipping through the Strait of Hormuz remains another major concern.

Before the conflict, more than 20 million barrels of oil and petroleum products passed through the strategic waterway each day. Reuters reports that flows have fallen sharply during the crisis, with thousands of seafarers also affected by disruptions.

Iran retains missile and drone capabilities despite significant damage to its military infrastructure, while Washington has maintained pressure through military operations, sanctions and restrictions on Iranian oil exports.

There are, however, signs of disagreement within Iran over how the country should respond.

Some military leaders have adopted a confrontational position, while President Masoud Pezeshkian and other senior political figures have highlighted the economic cost of the confrontation and the need for a diplomatic solution.

Washington and Tehran have previously attempted to negotiate an interim arrangement, but Reuters reported earlier this month that discussions had made little progress towards a permanent settlement.

The Trump administration argues that stronger economic pressure could force Tehran to change course on its nuclear programme and other security issues.

Iran rejects that position and maintains that repeated sanctions have failed to resolve the underlying dispute.

The effectiveness and scope of the new measures will become clearer when the US Treasury releases details on Monday.