Iran's economy on the abyss: Inflation and sanctions hit hard!

Iran's economy on the abyss: Inflation and sanctions hit hard!

The economic situation in Iran is increasingly tense, while the US government further expands its sanctions against the Islamic Republic. The Iranian rial's loss of value already has a serious impact on prices in the country, which forces many citizens to significantly reduce their expenses. According to vienna.at , many Iranians complain about rapidly rising food prices that have become unaffected for many, so that essential foods such as meat or fish have to be dispensed with. This economic pressure is reinforced by the political and economic isolation of Iran, which is little alleviated by a more intensive partnership with Russia and China.

US sanctions and their effects

On Monday, the US State Department announced sanctions against over 30 companies, ships and people who are part of Iran's so-called shadow fleet. This shadow fleet, often used as a means of bypass existing sanctions, obscures the origin and goal of a commercial goods, including the identity of the ship owners. Based on these measures, such as taz.de , there are also important oil dealers and companies among the sanctioned actors who are responsible for Iran's oil and gas export. These sanctions show the ongoing tensions and challenges that Iran faces, especially in terms of international trade and raw material prices.

The situation continues to be complicated, since Iran is not ready to sit down at the negotiating table despite the pressure to discuss its controversial nuclear program. Iran’s head of state Ali Chamenei has given negotiations with the USA several times. Instead, the country seems to deepen its energy and trade relationships with Russia and China in order to counter the pressure from Washington. In this tense situation, there are already an impact on global oil prices that have increased by several cents per barrel due to the new sanctions.