Bessent says 80-90% of external flights from Iran are grounded

The Treasury Secretary questioned how Iranian diplomats at the UN would get home, as oil and bond markets already price in rising Middle East risk.

Treasury Secretary Bessent said external flights from Iran have been largely shut down, with more than 80 or 90 percent grounded. He questioned how Iranian representatives at the United Nations would now return home.

The comment adds to a standoff over the Strait of Hormuz. The US rejected an Iranian proposal to reopen the strait. Iran has said the strait stays shut until Washington agrees to its own safe-passage plan, with a four to five day deadline running. Iran's Foreign Ministry spokesperson has listed conditions for nuclear talks, including an end to a naval blockade and the unfreezing of Iranian assets.

Brent crude settled near $103 a barrel on Wednesday. The same day, a weak $70 billion five-year Treasury auction and the strongest US business activity reading since 2021 pushed bond yields toward two-decade highs. The 10-year yield hit 5.081%, its highest since July 17. The five-year yield reached 5% for the first time since 2007.

Bessent's remark hardens a confrontational US stance after days of indirect diplomatic messaging, and signals Washington is willing to use economic pressure on Iran's air links as leverage. That makes near-term de-escalation less likely and adds to the risk premium already built into Middle East markets. With Brent at $103 and yields near two-decade highs, any further tightening of Iranian airspace adds to inflation risk that could push the Federal Reserve to hold interest rates higher for longer.