Sanctions and a U.S. blockade are increasingly straining Iran’s economy, making it harder for Tehran to bypass restrictions and access foreign currency, three senior Iranian sources told Reuters.
Washington has intensified economic pressure on Tehran in recent weeks, seeking concessions in potential future negotiations after six months of conflict that have so far yielded no results.
While Iranian leaders have for decades managed to circumvent sanctions, the latest U.S. measures have placed them in a far more difficult position, leaving few channels to obtain foreign currency and purchase goods, the sources said. A particularly serious and urgent threat, they noted, is the attempt to cut off Iran’s access to international financial networks in other countries, which it has long used to sustain its economy.
Any signs that economic pressure could help end the months‑long stalemate in the war would likely be a positive signal for U.S. planners. At the same time, Iran has warned it may respond to the pressure with military escalation, raising the stakes at a critical moment in the conflict.
Rial’s fall and shrinking gasoline reserves
This week, the war again escalated into open combat, with U.S. strikes along the Persian Gulf coast prompting Iranian retaliatory attacks on American bases in Arab states.
Neither side has yet shown a willingness to make the concessions the other demands, leaving the war in a costly deadlock, though Reuters assesses the situation may begin to shift.
Although more energy supplies continue to reach international markets through the Strait of Hormuz, the U.S. blockade on Iran’s oil exports has effectively cut off Tehran’s main revenue source.
Even before the conflict, Iran’s economy was in deep crisis, with a rapidly depreciating currency, soaring inflation, and massive costs to rebuild industry and infrastructure damaged by months of bombings.
Financial pressure is now making it harder for Tehran to bypass sanctions, as it has fewer funds to pay the high premiums required for illicit circumvention, the sources said.
The Iranian rial has plummeted to record lows in recent days. One senior source told Reuters that Iran’s gasoline reserves are now enough for roughly two months. The country is forced to import gasoline despite its own oil production because of limited refining capacity.
Iranian leaders are aware of the risk of economic collapse and the possibility of new nationwide protests, which authorities crushed in January, resulting in the deaths of thousands of demonstrators, according to the sources.
«They are under very, very heavy economic pressure. They are losing control of the channels. It’s really a question of whether they decide to negotiate, and I think they will have to», said Ali Ansari, a professor of modern history at University of St Andrews in Scotland.
Secondary sanctions complicate trade
The war is also entering a new phase, with each side attempting to influence the other’s domestic political processes. According to a senior Iranian official, Tehran hopes the threat of inflation will restrain the U.S. administration ahead of November’s midterm elections, while Washington seeks to push Iranians toward uprising.
Recent U.S. measures have expanded secondary sanctions against countries doing business with Iran. Their goal is to prevent Tehran from conducting dollar transactions, which are essential for both oil sales and financing critical imports of goods and raw materials.
Three senior Iranian sources say these measures are making existing sanctions‑evasion networks—front companies, unregistered tankers and smuggling schemes—too costly to use.
According to commodity‑analytics firm Kpler, Iran’s crude oil loadings this month have fallen to about 260,000 barrels per day, compared with roughly 1.7 million barrels a year earlier. Only small volumes are still being shipped from terminals for further transport by trucks, trains or smaller vessels across the Caspian Sea.
Tehran claims it still has tens of millions of barrels stored in tankers outside the blockade zone that could be sold, but new sanctions are forcing intermediaries to back out or demand higher fees, one Iranian official said.
President Masoud Pezeshkian said Iran’s total trade volume has declined by 25–35%, with imports hit harder than exports. He is among several senior officials who have warned in recent weeks of a rapidly deteriorating situation in the country.
U.S. pressure and Iran’s own attacks have also disrupted one of Iran’s main trade channels—the United Arab Emirates. On August 19, the UAE announced that all commercial and financial transactions with Tehran were suspended until further notice.
«If these channels remain closed, the supplier will want cash, the deal will be routed through another country, and the cargo will arrive later and at a higher cost», a Tehran‑based trader involved in imports told Reuters.
The rial’s exchange rate has fallen from about 1 million rials per dollar a year ago to over 2.2 million now.
Domestic consequences are severe. Official data shows average inflation over the past 12 months at 69.9%, while food, beverage and tobacco prices are rising nearly twice as fast.
The official unemployment rate rose to 9.1% in spring, and the number of employed people fell by about 450,000 compared with a year earlier amid a broader decline in labour‑force participation.
Even for those still working, the average monthly wage is around $125, far below the estimated basic household expenses of $450 per month, according to official data.
«We are getting poorer every day», said Mahnaz, a 34‑year‑old private‑sector worker in Tehran who asked not to be identified by her last name.
Source: Reuters / The Straits Times
