U.S. Department of State
Updated
Summary
The U.S. Department of State is the federal foreign-affairs department, led since 2025-01-21 by Secretary of State Marco Rubio. Besides diplomacy, it holds several sanctions levers of its own: it designates Foreign Terrorist Organizations, imposes Iran and Russia blocking sanctions under executive orders it shares with Treasury, sets visa restrictions and runs Rewards for Justice. Since 2025 it has also run U.S. foreign assistance. USAID stopped implementing aid on 2025-07-01, after Rubio, as acting USAID administrator, announced the cancellation of 83% of its programs. Under the 2026-10-16 order implementing the Graham Act, the Secretary of State is one of two officials (with the President) who can end the waivers of the Act's Russia tariffs and sanctions.
Key numbers
Secretary of State: Marco Rubio (entered on duty 2025-01-21) (as of 2025-01-21). Source: history.state.gov
USAID-managed programs cancelled (announced 2025-03-10): 83% (as of 2025-09-05). Source: congress.gov
Date USAID ceased implementing foreign assistance (State absorbs aligned programs): 2025-07-01 (as of 2025-09-05). Source: congress.gov
FTO designations by State, calendar 2025 / 2026 to 2026-09-10 (AA row count): 25 / 8 (as of 2026-09-10). Source: state.gov
State Iran designations in 2026-10-08 action (entities / individuals / vessels): 10 / 6 / 5 (as of 2026-10-08). Source: state.gov
Rewards for Justice offer on IRGC financial mechanisms: up to $15 million (as of 2026-08-07). Source: state.gov
Individuals under Iran freedom-of-expression visa restriction policy: 58 (as of 2026-02-18). Source: state.gov
State Russia (E.O. 14024) delistings on 2026-06-24 (individuals / entities / vessels): 7 / 2 / 2 (as of 2026-07-20). Source: federalregister.gov
Graham Act waiver expiry date: none stated; ends when President or Secretary of State determines further action (as of 2026-10-16). Source: whitehouse.gov
UN Security Council resolutions on Iran restored by snapback: 6 (as of 2025-09-27). Source: state.gov
Timeline
2026-10-16 — Graham Act order waives the Act's duties and specified sanctions; the Secretary of State can end the waivers and receives delegated functions, including section 115. (Source: whitehouse.gov)
2026-10-08 — State designates 10 entities and 6 individuals and blocks 5 vessels in Iran's petrochemical and shadow-fleet trade (E.O. 13846). (Source: state.gov)
2026-09-23 — Rubio says Iran "killed the MOU" and that use of the Graham Act waivers is up to the President. (Source: state.gov)
2026-09-18 — President signs the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026. (Source: whitehouse.gov)
2026-09-10 — State acts against Kata'ib Hizballah and Hizballah networks under Operation Economic Outcast; Los Tiguerones designated an FTO the same day. (Source: state.gov)
2026-08-07 — State designates two Iran-linked digital asset exchanges and a network; Rewards for Justice offers up to $15 million on IRGC finance. (Source: state.gov)
2026-06-24 — State delists seven individuals, two entities and two vessels under the Russia E.O. 14024 program (published 2026-07-20). (Source: federalregister.gov)
2026-06-19 — White House says Trump and Vance signed an MOU with Iran; negotiators named as Vance, Witkoff and Kushner. (Source: whitehouse.gov)
2026-06-05 — FTO designation of Brazil's PCC and Comando Vermelho, signed by Rubio, takes effect. (Source: federalregister.gov)
2026-04-27 — Rubio: "we have a ceasefire right now" with Iran; rejects Hormuz tolls. (Source: state.gov)
2026-03-30 — Rubio sets out Iran war objectives and says talks run mainly through intermediaries. (Source: state.gov)
2026-02-18 — State adds 18 Iranian officials to visa restrictions (58 in total). (Source: state.gov)
2025-11-24 — Cartel de los Soles designated an FTO. (Source: state.gov)
2025-09-27 — UN sanctions on Iran reimposed via snapback; six resolutions restored. (Source: state.gov)
2025-09-18 — Four Iran-aligned Iraqi militia groups designated FTOs. (Source: state.gov)
2025-07-01 — USAID ceases to implement foreign assistance; aligned programs move to State. (Source: congress.gov)
2025-03-28 — Rubio notifies Congress of intent to realign USAID functions into State by 2025-07-01. (Source: state.gov)
2025-03-05 — Ansarallah (the Houthis) designated an FTO. (Source: state.gov)
2025-02-20 — Eight cartels and gangs designated FTOs and SDGTs. (Source: state.gov)
2025-02-03 — Rubio appointed Acting Administrator of USAID. (Source: state.gov)
Key actors and links
Sanctions on Russia (policy:russia-sanctions): Under the 2026-10-16 order the Secretary of State can end the Graham Act waivers; State also designates and delists under E.O. 14024.
U.S. Treasury (actor:us-treasury): Co-implementer: OFAC administers blocking and leads Operation Economic Outcast; most Graham Act delegations to State require consultation with Treasury.
U.S. Senate (actor:us-senate): Passed the Graham Act; senators wrote to Secretaries Rubio and Bessent on implementation (2026-10-06).
Sanctions/enforcement (indicator:energy-sanctions-enforcement): State's oil and petrochemical designations against Iran and its Russia listings feed this enforcement-intensity indicator.
Iran (country:iran): Main target of 2026 State designations, visa restrictions and Rewards for Justice offers, and the subject of Rubio's war and ceasefire diplomacy.
Islamic Revolutionary Guard Corps (IRGC) (actor:irgc): State targets IRGC finance, including a Rewards for Justice offer of up to $15 million.
2026 Iran war (event:2026-iran-war): Rubio set out U.S. war aims and described the April ceasefire and the June MOU's collapse; the White House named others as the MOU negotiators.
Iranian oil exports (commodity:iranian-oil-exports): State designations of shadow-fleet vessels and petrochemical traders aim to cut this revenue.
Strait of Hormuz (place:strait-of-hormuz): Rubio rejects Iranian tolls and sovereignty claims over the strait.
U.S. Agency for International Development (actor:usaid): Rubio became acting administrator in 2025; USAID stopped implementing foreign assistance on 2025-07-01 and State took over the programs it kept.
U.S. democracy assistance (theme:us-democracy-assistance): Democracy and other assistance programs that survived the 2025 cuts are now run by State.
2025 U.S. foreign-assistance pause (policy:us-foreign-assistance-pause-2025): State implemented the 2025 foreign-aid review that preceded the 83% program cancellation.
Houthis (actor:houthis): State designated Ansarallah an FTO on 2025-03-05.
Brazil (country:brazil): State designated Brazil's PCC and Comando Vermelho as FTOs effective 2026-06-05.
Iraq (country:iraq): State designated four Iran-aligned Iraqi militias as FTOs in 2025 and targets Kata'ib Hizballah networks.
Why it matters now
In October 2026 State matters as a dial on sanctions intensity, not just as a messenger. On the Russia side, the 2026-10-16 order waives the Graham Act's duties and specified sanctions with no expiry. It leaves the decision to end them with the President or the Secretary of State, after consultation with Treasury and the Trade Representative, and delegates the Act's waiver section to State. State also shows it can loosen as well as tighten: in June 2026 it delisted seven individuals, two entities and two vessels from the Russia program. On the Iran side, State runs a steady flow of designations under Operation Economic Outcast, which the White House describes as Treasury-led. Recent rounds hit shadow-fleet vessels, petrochemical traders, digital asset exchanges and Kata'ib Hizballah networks, alongside visa restrictions and a $15 million Rewards for Justice offer.
State's role in the Iran war diplomacy is visible but not central on the primary record. Rubio set out war aims in March, confirmed a ceasefire in April and said in September that Iran "killed" the June MOU. The White House credits Vance, Witkoff and Kushner with negotiating that MOU. The 2025 realignment of selected USAID functions made State the administrator of foreign-assistance programs retained as aligned with administration policy, including surviving democracy assistance. USAID's statutory existence, though, was still the subject of pending bills in September 2025.
Risks and open questions
Bull case: Case for State as an effective lever (AA inference): State has a large, active toolkit and uses it often. It made 25 FTO designations in 2025, ran repeated Iran designation rounds through October 2026, holds a $15 million IRGC rewards offer and supported a completed UN snapback. Under the Graham Act order the Secretary can restore the Act's Russia penalties without new legislation, which gives U.S. diplomacy a credible escalation option.
Bear case: Case against (AA inference): The levers that matter most for markets sit elsewhere. Treasury leads Operation Economic Outcast, the White House envoys negotiated the Iran MOU, and the President set the Graham waivers. The State-held option to end them has no deadline and no stated trigger. The Iran MOU collapsed and the April ceasefire did not hold. State also took on retained USAID programs while the future structure and staffing of those functions remained unsettled. The waivers leave Congress's intended Russia pressure unused.
Falsifiers: - The Secretary of State ends the Graham Act waivers, or publicly sets conditions for doing so: this would show State actively using the Russia lever. - Large new State designations under E.O. 14024, especially of shadow-fleet tankers, rather than further delistings. - State, not White House envoys, leads a signed Iran settlement or ceasefire text. - Iran designation rounds by State stop or reverse (delistings) as part of a deal. - Congress enacts a law that keeps USAID as an independent agency or reverses the transfer of its functions to State.
What to watch
Any determination by the President or Secretary of State to end the Graham Act waivers, and publication of the section 115 certification and report. (no scheduled date); Source: whitehouse.gov
Further Operation Economic Outcast designation rounds by State against Iran's oil, petrochemical and shipping networks. (no scheduled date); speculative, no scheduled source
New State Federal Register notices under the Russia E.O. 14024 program (designations or delistings) after the Graham Act waiver. (no scheduled date); speculative, no scheduled source
Resumed U.S.-Iran talks after the MOU's collapse, and who leads them for the United States. (no scheduled date); speculative, no scheduled source
Further FTO designations of Western Hemisphere criminal groups, as in 2025-2026. (no scheduled date); speculative, no scheduled source
AA inference
Inference (AA): State is best read as a switch for sanctions intensity with two settings. Designations, FTO listings, visa bans and rewards tighten pressure, mostly on Iran. Waivers and delistings ease it, mostly on Russia in 2026. The Graham Act order gives the Secretary of State a direct hand on the Russia setting. Ending the waivers would turn on the Act's tariff and sanctions machinery without a new law. That makes State's statements and Federal Register notices a leading indicator for the policy:russia-sanctions and energy-sanctions-enforcement nodes. On Iran, State's designations add to Treasury's campaign rather than drive it. Its diplomatic weight in the war looks secondary to the White House envoys.
Sources
Marco Rubio was appointed Secretary of State and entered on duty on 2025-01-21; the Office of the Historian lists him as a non-career appointee from Florida. (Source: history.state.gov, accessed 2026-10-18)
On 2025-02-03 the State Department announced that Secretary Rubio had been appointed Acting Administrator of USAID, stating that significant portions of USAID funding were not aligned with core U.S. national interests. (Source: state.gov, accessed 2026-10-18)
On 2025-03-28 Secretary Rubio stated that State and USAID had notified Congress of their intent to realign certain USAID functions to the State Department by 2025-07-01, with remaining functions discontinued if not aligned with administration priorities. (Source: state.gov, accessed 2026-10-18)
CRS reports that on 2025-03-10 Secretary Rubio announced the cancellation of 83% of USAID-managed foreign aid programs (CRS In Focus IF10261, updated 2025-09-05). (Source: congress.gov, accessed 2026-10-18)
CRS quotes Secretary Rubio that as of 2025-07-01 USAID would officially cease to implement foreign assistance, with programs aligned to administration policy administered by the State Department. (Source: congress.gov, accessed 2026-10-18)
CRS notes Congress codified USAID in statute (section 1413 of the Foreign Affairs Reform and Restructuring Act of 1998); bills to abolish it (H.R. 1029, H.R. 1123) and to bar funding its elimination (H.R. 1196) were pending as of that update. (Source: congress.gov, accessed 2026-10-18)
On 2025-02-20 the State Department designated eight groups, including Tren de Aragua, MS-13 and the Sinaloa and Jalisco cartels, as Foreign Terrorist Organizations and Specially Designated Global Terrorists under INA section 219 and E.O. 13224. (Source: state.gov, accessed 2026-10-18)
The State Department's FTO list shows 25 designations dated 2025 and 8 dated 2026 through 2026-09-10 (AA count of table rows), including Ansarallah (2025-03-05), four Iraqi militia groups (2025-09-18), Cartel de los Soles (2025-11-24) and Los Tiguerones (2026-09-10). (Source: state.gov, accessed 2026-10-18)
Secretary Rubio signed the FTO designation of Brazil's Primeiro Comando da Capital and Comando Vermelho on 2026-05-28 under INA section 219, in consultation with the Attorney General and Treasury; it took effect on publication on 2026-06-05 (91 FR 34267). (Source: federalregister.gov, accessed 2026-10-18)
A State Department Federal Register notice (91 FR 45310, published 2026-07-20) records that on 2026-06-24 State removed seven individuals, two Turkish entities and two vessels from the SDN List under the Russia harmful-foreign-activities program (E.O. 14024). (Source: federalregister.gov, accessed 2026-10-18)
State said UN sanctions on Iran were reimposed on 2025-09-27 at 8:00 p.m. EDT, restoring Security Council resolutions 1696, 1737, 1747, 1803, 1835 and 1929 after an E3-initiated snapback. (Source: state.gov, accessed 2026-10-18)
In a 2026-03-30 interview Secretary Rubio described U.S. objectives in Iran as destroying its air force, navy, missile launchers and missile and drone factories, said regime change was not the objective, and said there were messages and some direct talks, primarily through intermediaries. (Source: state.gov, accessed 2026-10-18)
On 2026-04-27 Secretary Rubio said "we have a ceasefire right now" with Iran and rejected any Iranian tolling of the Strait of Hormuz, calling it international waters. (Source: state.gov, accessed 2026-10-18)
A 2026-06-19 White House release says President Trump and Vice President Vance signed a Memorandum of Understanding with Iran; it quotes a Pakistani official naming the U.S. negotiators as Vance, Witkoff and Kushner and does not mention the Secretary of State. (Source: whitehouse.gov, accessed 2026-10-18)
On 2026-08-07 State announced designations of six entities and one individual, including two digital asset exchanges used by Iran, under E.O. 13902 and E.O. 13224, and a Rewards for Justice offer of up to $15 million for information disrupting IRGC financial mechanisms. (Source: state.gov, accessed 2026-10-18)
The White House announced Operation Economic Outcast on 2026-08-24 as a Treasury-led campaign targeting Iran's digital assets, technology, gold, aviation and shipping sectors; the release does not mention the State Department. (Source: whitehouse.gov, accessed 2026-10-18)
On 2026-09-10 State announced Operation Economic Outcast actions against Kata'ib Hizballah, Hizballah and related networks under E.O. 13224 and E.O. 13902, noting Kata'ib Hizballah has been an FTO since 2009. (Source: state.gov, accessed 2026-10-18)
The White House says the President signed H.R. 5334, the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026, on 2026-09-18. (Source: whitehouse.gov, accessed 2026-10-18)
At a 2026-09-23 press availability Secretary Rubio said the Graham Act was the first grant of tariff authority to a President in about 70 years and that how the President uses its waivers "is up to him". (Source: state.gov, accessed 2026-10-18)
At the same 2026-09-23 availability Rubio said Iran "killed the MOU" and that Russia and Ukraine had expressed interest in a limited grain and energy ceasefire that would not solve the war. (Source: state.gov, accessed 2026-10-18)
On 2026-10-08 State designated 10 entities and 6 individuals and identified 5 vessels as blocked property under E.O. 13846 in an Operation Economic Outcast action against Iran's petrochemical trade and shadow fleet. (Source: state.gov, accessed 2026-10-18)
Section 4(d) of the 2026-10-16 order says the Graham Act waivers remain in effect until the President or the Secretary of State, in consultation with the Secretary of the Treasury and the Trade Representative as appropriate, determine that further action is appropriate. (Source: whitehouse.gov, accessed 2026-10-18)
Section 5(a) of the 2026-10-16 order delegates Graham Act functions to the Secretary of State, including section 115 (the waiver provision) in consultation with Treasury and the Trade Representative, and other functions in consultation with Treasury. (Source: whitehouse.gov, accessed 2026-10-18)
Sections 2 and 3 of the 2026-10-16 order require consultation with the Secretary of State on duty rates and on monitoring that informs the President of any need for further action, including on the waivers. (Source: whitehouse.gov, accessed 2026-10-18)
On 2026-02-18 State added 18 Iranian officials and telecommunications leaders to visa restrictions under INA section 212(a)(3)(C), bringing the policy to 58 individuals. (Source: state.gov, accessed 2026-10-18)