What’s behind Trump’s shift to economic pressure on Iran? Will it work?

More than 23 weeks into the war on Iran, United States President Donald Trump has signalled he would rather rely on squeezing Tehran’s economy than returning to a military offensive, as he had warned he might last week.

Shipping through the Strait of Hormuz, the critical waterway now central to negotiations aimed at ending the war, remains disrupted by Iranian forces as a US naval blockade tightens its grip on Iranian ports.

While Iran and Oman have said they are close to reaching an agreement on the management of the Strait of Hormuz, Trump said the US is “only semi-negotiating” with Iran. Tehran has denied direct talks at all with Washington.

So after months of expansive fighting, why is Trump turning to economic pressure over military force in this conflict?

“We are low-keying it,” Trump told the news website Axios in an interview on Sunday regarding the US approach to the war on Iran. This signals a complete change from his comments last week when he gave “duplicitous” Iran “ one last chance ” to make a deal or suffer catastrophic strikes.

He said Iran is in “very bad shape” financially, citing high inflation and difficulty paying its own soldiers, and credited a US naval blockade in place since April with increasing that pressure.

“We are just watching Iran with its huge inflation and the fact they have no money,” he said.

Trump also claimed that falling prices of oil, which was trading at about $78 a barrel on Monday, have eased the economic impact on US consumers of the war and the closure of the Strait of Hormuz, which had sent oil prices above $100 a barrel for a time.