Bessent: tariffs could return by July as Iran tensions rise

Treasury Secretary Scott Bessent warned tariffs could be reinstated to prior levels as early as July and said the administration could act quickly on trade measures if needed. The warning comes as markets contend with the economic effects of the Iran war and energy market disruptions.

Bessent described U.S. policy on China as de-risking rather than full economic decoupling and flagged concern over China’s growing trade surplus. He indicated Washington may pursue measures to rebalance trade flows.

The Treasury continues to see underlying U.S. momentum, projecting growth could top roughly 3% to 3.5% this year.

The timing of the tariff warning coincides with tighter oil markets linked to tensions around the Strait of Hormuz and a rise in inflation expectations. Market participants say higher tariffs would likely raise input costs for firms, complicate global supply chains and reduce cross-border demand.

Analysts and corporate officials are monitoring whether tariff threats will become concrete measures by July and how companies will adjust inventories, sourcing and pricing plans. Reinstating tariffs to previous levels would increase trade friction and could accelerate a shift toward more regional trade patterns.

Bessent cautioned that short-term diplomatic engagement, including a planned visit by former President Donald Trump to Beijing on May 14–15, should not be read as a sign that the U.S. will abandon trade concerns. He stressed the objective is to limit strategic dependencies while preserving key commercial ties.

Economists say the combination of renewed tariffs and ongoing energy market disruption raises the risk of slower global growth paired with persistent inflation. Observers will watch fiscal and regulatory signals from the Treasury and other agencies, along with any formal tariff announcements, to assess how quickly markets and corporate supply chains may need to adjust.