Criticism Of Iran Government Intensifies As Protests Spread To Tehran

The data and analytics firm Kpler was quoted by Prague-based, US-financed Persian language Radio Farda as saying that Iran’s illicit shipments of crude mainly to Asian markets dropped to around 400,000 barrels per day (bpd) in May.

The shipments were estimated to have been 908,000 bpd in March and 820,000 in April, as Iran claimed it is selling more than a million bpd in recent months.

When the United States imposed full oil export sanctions on Iran in May 2019, exports dropped from more than 2 million barrels a day in 2016-2017 to around 250,000. China was the main buyer of Iranian crude in this period.

Toward the end of 2020, as it became clear that then-President-elect Joe Biden was determined to revive the 2015 nuclear agreement (JCPOA) with Iran abandoned by his predecessor in 2018, Iranian crude exports began to increase. China might have calculated that the risk of US retaliation decreased with the prospects of talks to restore the nuclear deal.

Exports gradually increased in 2021 as the United States engaged in indirect nuclear talks in Vienna. It reached new highs in early 2022 before the Russian invasion of Ukraine and sanctions on Moscow by many countries. Since then, Russia has apparently turned to China to sell its crude which happens to be Iran’s main oil customer.

In May, Reuters reported that about 20 tankers carrying around 40 million barrels of Iranian oil were waiting near Singapore to sell their cargos. As oil market monitoring firms have reported in the past Iranians oil is sold most probably to middlemen who then transfer the crude to Chinese ‘teapot’ small refineries.

Kpler told Radio Farda that the quantity of Iran’s unsold oil has not changed much, probably because shipments have declined.

Iran has denied that Russia is taking its market share, but $30 barrel reported discounts by Russia are apparently much more than Iran offers to customers willing to take a risk and buy its sanctioned crude.

The hardliner government of President Ebrahim Raisi prides itself for having “defeated US sanctions” and increased oil exports, as it tries to calm a volatile economic environment at home. The danger of three-digit inflation in Iran and the fall of its currency to a historic low over the weekend have led to angry protests on the streets.

The reported fall in exports in May can deal a new blow to Iran’s hard-pressed economy and further destabilize the political scene.

The year-long nuclear negotiations remain in deadlock, as Tehran demands its revolutionary Guard be removed from the US list of Foreign Terrorist Organizations (FTO).

The US has signaled that if talks make no progress and Iran continues to expand its nuclear program, it may decide to tighten the screws on Tehran, which may mean a more rigorous enforcement of existing sanctions.

Hossein Amir-Abdollahian made the remarks on Sunday after attending a session of the Parliament’s Committee on National Security and Foreign Policy to brief lawmakers about a resolution passed by the board of governors of the International Atomic Energy Agency (IAEA) to condemn lack of cooperation by the Islamic Republic. 

“Every time that the opposite side put forth excessive demands during the [Vienna talks], we used the country’s own tools and power, so that they would understand that the interests and welfare of the Iranian nation were important to us,” he said without elaborating on the tools, but he was probably referring to the government’s decision to reduce monitoring access to the UN nuclear watchdog. 

Iran told the IAEA it plans to remove more monitoring equipment after the 35-member IAEA board Wednesday passed the resolution. Tehran says it intends to maintain a basic level of monitoring and inspectors’ access as required under the Nuclear Non-Proliferation Treaty (NPT).

In a statement issued by the Iranian parliament on Sunday, 260 lawmakers slammed the IAEA's “excessive, politically-motivated measure,” saying the resolution proves that the agency and its director general have lost all their technical credibility, in reference to Rafael Grossi’s recent visit to Israel.

On Friday, all Friday Prayer Imams in Iran, who are representatives of the Supreme Leader, backed the decision to reduce relations with the IAEA.

In his visit to the Sayyad-Khodaeis on Sunday, Ebrahim Raisi said that his assassination by the opponents of the Islamic Republic in Tehran near his home, instead of confronting him on the battlefield, is a sign of their despair and a victory for the country.

Despite Raisi’s assertion of victory, the assassination was seen as an intelligence and security failure by the government that allowed the killing of a secretive officer in broad daylight in the capital.

Sayyad-Khodaei was the acting commander of the elite Quds Unit 840, who was shot dead behind the wheel of his car on May 22 by two gunmen who fled the scene on a motorbike.

A European security source told Iran International in late May that Sayyad-Khodaei was in charge of planning terror operations outside Iran, including attacks in India, Thailand, Cyprus and Georgia. Suspicions for his assassination fell on Israel and according to some reports, Israeli officials told the United States that they had targeted Sayyad-Khodaei.

After his assassination, Iran International’s sources in Iran reported that another Quds Force unit 840 commander died under suspicious circumstances in Karaj, west of Tehran, on May 30. Colonel Ali Esmailzadeh died when he fell from the roof of his home.

The signatories, mostly professors of economics in Iranian universities and many who have held government posts, suggest the government’s “economic surgery” since March has led to “social chaos and worsening economic instability.”

With the new Iran year beginning March 22, President Ebrahim Raisi with the backing of parliament began a plan to phase out state subsidies on food imports that had been costing $9-15 billion a year.

While in part a response to global food inflation sparked partly by the invasion of Ukraine, the move, quickly dubbed “economic surgery,” was officially portrayed as a serious reform of Iran’s state-dominated economy.

‘Quick measure in face of global price crisis’

The economists charged in their statement that the motivation was purely fiscal, easing a shortfall in the government budget, and that real reform required more serious change: “[The move was] a temporary and quick measure for addressing the budget deficit amid sanctions and a global food price crisis. We cannot consider this an economic reform.”

The economists argued that this “economic surgery” would lead to a further fall in the value of the Iranian rial and lead to “repeated economic shocks,” and said the government had not engaged with the public about where the policy would lead.

The economists noted Raisi’s election campaign promises to form an inclusive government, utilize experts to draft economic plans, slash “the 50-percent inflation rate,” and build one million housing units each year.

100%

But the economists argued it would not be possible to fulfil such promises without an early agreement in talks with world powers to revive the 2015 nuclear deal and accession to international transparency and related regulations demanded by the Paris-based inter-state Financial Action Task Force (FATF), which blacklisted Iran in 2020.

Despite various restrictions on non-governmental media, many experts and business figures had warned over “the horrible” results of “inaction” in foreign policy and ill-designed policies, the economists said. Economic shocks and the pausing of nuclear talks in March had fed instability, social chaos, and widespread concern among the people over their livelihoods, creating an “explosive” situation.

They went on to warn that “the country’s situation is extremely fragile,” given the elimination of food subsidies. “People’s patience will run out and will place the government and the regime face-to-face with the people.”

Three recommendations

The signatories made three recommendations.

First, the state should have sufficient oil and non-oil export revenues and foreign currency reserves to ensure secure handling of economic fluctuations.

Second, the government should have clear and effective policies to foster macro-economic stability, with control over inflationary budgets.

Third, the government should ensure low-cost access to global markets for goods and services.

The last recommendation is related to extra costs Iranian government and businesses have to bear to do international transaction, given US sanctions and FATF’s blacklisting.

Low growth

The economists warned that Iran had lost ground economically compared with most other countries since 1980, with average growth of 1.6 precent, whereas growth in China, India, Turkey, Malaysia, the United Arab Emirates, and Pakistan had ranged from 4 to 10 percent.

The economists spoke of vanishing hopes, growing poverty and a widening income gap that have led to vengefulness in society. The resulting disorder exhibited itself in destruction of the environment, systematic corruption, widespread emigration, capital flight and brain drain.

The 61 signatories called for “fundamental change in foreign policy” aimed at peaceful coexistence, cooperation with neighbors, and interaction with the world’s economic powers. They also urged improvement in governance, with respect for law, minimizing corruption, establishing an independent judiciary, dialogue and transparency, and allowing “true economic competition” in society.

Reza Moradkhani said in an interview with Shargh daily published Saturday that they were walking in the Pardisan park in Tehran late in May when a 22-year-old morality police officer confronted his wife, Maria Arefi, and following verbal confrontation with the agents they pepper sprayed Moradkhani and Arefi and even their toddler. 

Moradkhani then charged for one of the agents who had insulted his wife and the agent fired 10 shots at him, four of which hit the Iranian national team boxer, resulting in his hospitalization. 

The Moradkhanis said that they had filed a complaint at the military court but that the court ruled against them and charged them with removing hijab and attacking a police officer.

The incident has gone viral on Iranian social media, with people condemning hijab policing and police impunity.

The paper quoted a witness as saying that the police officer who fired at Moradkhani forced bystanders who were recording the incident to erase their phones.

Moradkhani, who has been a boxer for the Iranian national team for many years and has won several Asian and world medals, is now unable to continue coaching due to the injuries in the incident.