Iran's Economy Under Siege

Six months after renewed Western sanctions, Iran’s economy is straining under a perfect storm. Oil exports have slumped, cutting state revenue by roughly a third, while the rial continues to tumble, pushing inflation past 50 per cent. The squeeze is hitting the most vulnerable – households face soaring food prices and job losses in the informal sector. At the same time, the fiscal strain is exposing rifts within the ruling elite, with hard‑liners demanding tighter control and reformists urging engagement with the West. The cost of staying afloat is rising, and Tehran’s ability to weather the storm is being tested like never before.

The pressure on Iran’s economy could trigger policy shifts and affect global oil markets, making it vital for investors and policymakers to monitor.

The economic squeeze on Iran reverberates beyond its borders. Lower oil output tightens global supply, nudging prices upward, while a destabilised Tehran could spark regional unrest. Western policymakers watch closely, weighing further pressure against the risk of a broader Middle Eastern flashpoint that could disrupt trade and energy markets worldwide.