Iran just lost its last two ways to move goods after America's oil blockade
1 hour ago · 1 October 2026Share
An Islamic Republic of Iran Railways locomotive hauls a passenger train through Iran. File photo. Kabelleger / David Gubler · CC BY-SA 4.0
The US just shut down the two backup routes Iran built after its oil got blockaded.
Here's what happened. The US Treasury sanctioned the two companies that make more than 90% of Iran's cars. It also sanctioned Iran's state railway.
So picture it. Oil gets blockaded. Iran switches to trucks and trains. Now trucks and trains are sanctioned too.
The Treasury Department announced it a few hours ago, alongside the State Department.
Two car companies got named. Iran Khodro, known as IKCO. And SAIPA. Together they build more than 90% of every car sold inside Iran.
Three rail companies got named too. The state-owned Islamic Republic of Iran Railway Company. Raja Passenger Trains. And a freight company called Sherkat-E Rah Ahan-E Khamle-O-Naghle.
One more company got named. Heavy Equipment Production Company, or HEPCO. Along with a HEPCO trading company based in Shanghai.
And here's the twist. Foreign suppliers in the UAE, Türkiye, Hong Kong, Indonesia, Germany and China got designated too. That means a Chinese company is now caught directly in US sanctions.
The sanctions came under two executive orders. One covers Iran's auto and rail sectors. The other covers its steel, aluminium and copper sector.
Scott Bessent is the US Treasury Secretary. He says the action targets Iran's enablers and says quote "drain the regime's revenue once and for all".
That's Bessent saying this is about draining Iran's money, for good.
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Contains modified Hodoyoshi-1 satellite imagery showing the Dasht-e Kavir desert in Iran. File photo. Axelspace Corporation · CC BY-SA 4.0
Now here's why cars and trains, specifically.
The US has spent months blockading Iranian oil through the Strait of Hormuz. So Iran started moving its petroleum, fertiliser and chemicals by road and by rail instead. Cars and trains became Iran's backup plan.
That backup plan is sanctioned now too.
This is part of a US campaign called Operation Economic Outcast. It started about five weeks ago, on 24 August. The goal is to cut off money that funds Iran's war, its missiles, its cyberattacks and the Revolutionary Guard. The bigger goal is forcing Iran back to the table to end the war.
And that war has been running about seven months. The US and Israel launched it in February, during nuclear talks with Iran.
Since then, US and Israeli strikes have killed Iran's Supreme Leader, Ali Khamenei, and other senior officials. Iran's government is still standing.
So sanctions are now doing a job that bombs haven't finished.
And that Shanghai company matters. It puts a Chinese business directly inside the reach of US sanctions, at a moment when Washington and Beijing are already at odds over Iran, trade and technology.
Iran has not said anything publicly about this round of sanctions yet. Nobody knows whether Tehran will respond, or how.
Here's what's still unknown. Will this push Iran toward negotiations? Or just deepen the isolation without changing anything? Iran has faced earlier rounds of this same operation and hasn't come back to the table yet.
Cars and trains were two of the last ways Iran had left to move goods in and out of the country once oil got squeezed. Both are sanctioned now. And Tehran still hasn't said what it does next.
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