Panic buying has surged in Tehran as Iran’s economy continues to deteriorate amid tightening U.S. sanctions and war-related disruptions. Recent demonstrations by workers and pensioners across the country signal growing public discontent over the declining currency and rising living costs.
Since the start of the year, Iran has experienced an upsurge in protests focused on economic grievances, which quickly escalated into widespread unrest leading to a harsh government crackdown that resulted in thousands of deaths. Although authorities have historically allowed some economic protests as a pressure release valve, recent gatherings have increasingly included political demands, despite the risks involved.
On Monday, offshore oil and gas workers staged a protest in the southern energy hub of Asaluyeh, asserting that those maintaining production should not face financial insecurity. The semi-official ILNA news agency reported these workers’ grievances about their livelihoods amid economic strain. The day prior, approximately 100 laid-off employees demonstrated at the Shadegan steel complex in western Iran over job losses.
The U.S. administration has signaled intentions to intensify sanctions in an effort to pressure Iran’s leadership to negotiate a resolution to the ongoing conflict, including reopening the strategically crucial Strait of Hormuz under terms more favorable to Washington. U.S. Treasury Secretary Scott Bessent warned on Monday that countries and companies engaging with Tehran would face punitive measures. These threats come as Iran’s economy reels from the combined effects of war damage, a U.S. naval blockade, and existing sanctions.
While analysts agree that the heightened sanctions will further burden ordinary Iranians, many argue that Iran’s leaders are unlikely to capitulate. The ruling establishment, which views the conflict as existential, has responded by rationing fuel supplies and diverting resources away from development projects to sustain vital functions.
Fuel shortages have become increasingly visible, with long lines at petrol stations in Tehran and other cities and some outlets reporting depletion. Anticipating reductions in subsidized fuel quotas, drivers have rushed to stock up. Though Iranian petrol remains heavily subsidized and among the cheapest globally, refinery damage sustained during the conflict, along with concerns over future import restrictions, have compelled authorities to plan rationing measures. Hamid Hosseini, spokesman for Iran’s oil exporting union, noted that the country currently imports fuel from Belarus, Turkmenistan, and Kazakhstan to supplement domestic production.
Supermarkets in Tehran have also seen shortages of staples such as cooking oil and rice, prompting consumers to hoard supplies. Despite government assurances that essential goods reserves are adequate for months, the announcement of tighter U.S. trade restrictions has already affected public sentiment.
Iranian officials, including President Masoud Pezeshkishian and parliamentary Speaker Mohammad Bagher Ghalibaf, have emphasized the need to end the conflict and stabilize the fragile economy. However, hardline factions appear set on maintaining high demands in any potential negotiations to increase the costs of the war for the United States.
Historical precedents underscore the government’s concerns; past sanctions and subsidy cuts triggered prolonged and deadly protests, including in late 2019 and again this year. Demonstrations persist at localized levels, particularly within strategic sectors such as telecommunications and petroleum, signaling underlying vulnerabilities despite crackdown efforts.
The precarious economic situation, compounded by sanctions and war impacts, continues to fuel unrest and economic hardship across Iran, posing significant challenges for the government’s control and negotiation stance.