"We Can't Live Like This Anymore" Protests Escalate Amid Economic Crisis and Panic Buying... What Is Happening in Iran?

U.S. isolation operation intensifies Iran's economic crisis
WSJ: "Small-scale protests and panic buying resurface"

As the war between the United States and Iran drags on, Iran's economy is heading toward severe catastrophe due to the United States' "economic isolation operation" and the impact of the maritime blockade. Hyperinflation has set in as Iran's national currency has plunged to an all-time low and prices of daily necessities have soared by several times. This has led to widespread panic buying of essentials, a fuel crisis, and even small-scale labor protests.

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According to foreign media such as The Wall Street Journal (WSJ) and Al Jazeera on the 26th (local time), the United States has launched an "economic isolation operation" to completely cut off funding to the Iranian regime, dealing a direct blow to Iran's financial and real economies. As of the 25th, the Iranian rial exchange rate fell to 2.05 million rials per dollar, plunging more than 7% in just one week and marking a record low. Compared to one year ago, Iran's real purchasing power in terms of the US dollar has effectively been halved.

The collapse of the currency's value has translated directly into explosive price increases for ordinary citizens. According to Al Jazeera, since the start of the war, the price of tomatoes has surged by 71%, chicken by 74%, and edible oil by a staggering 177%. Most notably, the price of insulin—vital for diabetes patients—has spiked by 642%, signaling a full-blown crisis for both medical supplies and daily necessities.

A money exchanger is counting US dollar bills at Ferdowsi Square, the foreign currency trading hub of Tehran. Photo by AP Yonhap News

US Maritime Blockade Leads to Rice and Fuel Shortages... 'Panic Buying' Sets In

The US maritime blockade of the Strait of Hormuz and subsequent airstrikes have damaged some oil refineries and choked off import routes, putting both energy and food security in jeopardy. Hamid Hosseini, spokesperson for the Iranian Oil Exporters' Union, stated via Iran's ILNA News Agency, "Domestic crude oil production cannot meet internal demand, leaving us very vulnerable to US sanctions." In reality, long lines of vehicles seeking fuel have formed at gas stations in major cities, including the capital Tehran.

The food situation has deteriorated rapidly as well. The United Arab Emirates (UAE), once Iran's main rice supplier, has joined the US sanctions and suddenly suspended all trade, sending fears over essential goods to new heights. WSJ reported that, in major supermarkets in Tehran, rice and cooking oil were temporarily sold out as a result of panic buying by citizens. While Iran's government has called for self-sufficiency, saying it has stockpiled several months' worth of essential goods, fear of protracted sanctions is spreading rapidly, fueling more panic buying.

Supermarket in Tehran. Photo by AFP News Agency

Labor Protests Centered on Livelihood Hardships

Labor protests, which had been dormant since the start of the war, have flared up again. According to Iran's ILNA News Agency, on the 24th, workers at offshore oil and gas facilities in Asaluyeh in the south protested over existential livelihood hardships and wage issues. On the previous day, the 23rd, about 100 laid-off workers from the Shadegan steel complex in the west took to the streets demanding reinstatement.

Protests over wage arrears or demands for wage increases are not uncommon in Iran. However, WSJ noted that since protests all but disappeared after the war broke out in late February, the recent resurgence is noteworthy.

Iran Emphasizes 'Self-Sufficiency' Despite US Pressure

The United States is strengthening economic isolation by squeezing Iran's key funding sources and trade networks. Following additional US sanctions, the UAE has now also suspended trade and financial transactions with Iran, further narrowing both import and settlement channels.

In response, the Iranian government has declared its intention to reduce dependence on external supplies and reinforce self-sufficiency. Authorities have also encouraged the younger generation to play a more active economic role, urging them to directly produce items needed for their households and communities.

However, experts point out that it is difficult to replace the economic scale and production base in the short term. In particular, with production and logistics disrupted by war and the currency in freefall, relying solely on self-sufficiency will not be enough to absorb the shock of rising prices and unstable supply.

Iranian Leadership Sees War as Existential—Little Prospect for Policy Change

It remains unclear whether US economic pressure will actually bring about a policy shift among Iran's leadership. The US aims to intensify Iran's economic woes to force it to the negotiating table, but most analysts agree that since Iran's leaders view this war as a matter of national survival, it's unlikely they will fundamentally change their negotiating stance—even as conditions for ordinary citizens worsen.

Trita Parsi, president of the Quincy Institute, told Al Jazeera, "These additional sanctions will inflict considerable pain and damage on the Iranian people, but translating that suffering into (leadership's) policy change is an entirely different matter."

This content was produced with the assistance of AI translation services.