US, Iran exchange fire in flare-up; Bessent sign sunctions

U.S. forces struck two rocket launchers on Iran's Larak Island on Sunday, marking the first known American strikes on the Islamic republic since late July.



The small Iranian island in the Strait of Hormuz near the strategic port of Bandar Abbas overlooks shipping lanes at the mouth of the Gulf, giving it a key role in tension over Iran, maritime security and global energy supplies.



Iran responded by launching an attack on two U.S. bases in Jordan.



The return to hostilities follows weeks in which the Trump administration has stepped up efforts to punish Tehran and its business partners with costly economic sanctions, shifting away from military options.



U.S. Treasury Secretary Scott Bessent told Reuters on Sunday new secondary sanctions were likely to be unveiled weekly in the effort to pressure Iran, with an initial focus on banks.



After imposing penalties on the United Arab Emirates branches of Egypt's Banque Misr on Friday over alleged financial links to Iran, Bessent said the next step may be cutting off an institution entirely from the dollar-based financial system.



"You're going to see a lot more of these every week," Bessent told Reuters, ahead of a meeting of Group of 20 finance leaders.