Iran Keeps Low Profile in Iraq's Vote, Still Pulls Strings

Iraqi Prime Minister Mohammed Shia al-Sudani (X)
Iraqi Prime Minister Mohammed Shia al-Sudani (X)
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Iran Keeps Low Profile in Iraq's Vote, Still Pulls Strings

Iraqi Prime Minister Mohammed Shia al-Sudani (X)
Iraqi Prime Minister Mohammed Shia al-Sudani (X)

Iran is allowing rival Shi’ite factions in Iraq to battle it out in a wide-open political arena ahead of the country’s November 2025 elections, adopting a hands-off approach as its regional influence wanes.

But officials and analysts say Tehran is quietly preparing a “Plan B” from a distance, wary of internal Shi’ite conflict and the potential return of populist cleric Moqtada al-Sadr.

While Iran remains largely absent from the backrooms where election alliances are typically shaped, insiders say it is still keeping close watch — ready to step in to prevent infighting among its allies, particularly as it seeks to stay out of the spotlight of US President Donald Trump’s administration in Baghdad.

Since Iraq’s Coordination Framework – a coalition of Iran-aligned Shi’ite parties – announced plans to run on separate lists, the race for Shi’ite votes has narrowed to two main figures: incumbent Prime Minister Mohammed Shia al-Sudani and former premier Nouri al-Maliki.

A senior leader in al-Maliki’s Islamic Dawa Party warned the contest could spiral beyond control.

Strategists working in the campaign teams of major Shi’ite factions say Tehran’s influence has notably waned.

“For the first time, we don’t feel Iran’s pressure in forming alliances,” said one operative. “But they’re still there, in case a political storm threatens to uproot the whole process.”

This marks a turning point in Iran’s role in Iraq. Rumors circulating in Baghdad suggest Tehran is willing to make sacrifices — potentially even among its Iraqi proxies — to safeguard the broader regional order, especially as its Houthi allies in Yemen face setbacks.

At the same time, Iranian-linked groups in Iraq have conveyed to Tehran a desire to integrate further into state institutions — even if that means laying down their arms temporarily.

Tensions between Baghdad and Tehran remain muted but persistent, particularly over how Iraq’s election dynamics might impact Iran’s stalled nuclear negotiations. Yet both sides appear to agree that the current political turbulence is temporary and necessary.

On April 25, 2025, Iran’s Supreme Leader Ali Khamenei described the talks with the United States as “a temporary situation,” telling mourners at a ceremony in Tehran that “the dominance of hypocrisy is not eternal, but a temporary divine test.”

Earlier, Iraqi sources told Asharq al-Awsat that Iranian-backed factions in Iraq had received religious authorization from Khamenei to engage in tactical maneuvers in response to pressure from Trump’s administration.

Recent interviews conducted by Asharq al-Awsat with Iraqi politicians paint a picture of near-chaotic freedom in the political arena — likened to “freestyle wrestling” — that could again spiral into street violence.

Some fear a repeat of the September 2022 clashes, when Sadr’s supporters stormed Baghdad’s fortified Green Zone to protest their exclusion from forming a majority government.

“Iran may have stepped out of the election kitchen,” said one political figure. “But it’s still very much inside the house.”

Fluid alliances

A fluid and shifting map of alliances is taking shape in Iraq’s Shi’ite political landscape ahead of the November 2025 parliamentary elections, as Iran adopts an unusually low profile, leaving its allies to grapple with strategy and rivalry on their own.

On April 10, 2025, Asharq al-Awsat revealed that Esmail Qaani, the commander of Iran’s Quds Force, had quietly left behind a small team in Baghdad to oversee political files, including preparations by Shi’ite factions for the elections.

But within two weeks, Iraq’s Iran-aligned Coordination Framework announced it would run as separate lists – a familiar tactic under Iraq’s electoral law, which divides the country into multiple constituencies and often amplifies internal rivalries.

Despite the presence of Qaani’s operatives, Iranian influence appears largely absent from the coordination rooms of the Shi’ite bloc.

“Tehran is going through a delicate moment,” said a senior leader in the Islamic Dawa Party. “It’s focused on defending its own political system and legacy, which explains why its presence in Baghdad is barely visible.”

That vacuum, according to the official, has allowed greater freedom among Shi’ite parties to explore alliances independently — though not without risk. “Operating without supervision has its dangers,” they added.

Over the past two weeks, a flurry of negotiations among Shi’ite parties has yielded little consensus, with many attempts to build joint electoral lists stalling amid shifting loyalties and strategic feints.

The result is what observers describe as a “liquid map” — alliances that form and dissolve without resolution.

Deputy Speaker of Parliament Mohsen al-Mandalawi drifted toward former Prime Minister Nouri al-Maliki’s State of Law Coalition before backing away. Likewise, Hadi al-Amiri, head of the Badr Organization, drew close to Prime Minister Mohammed Shia al-Sudani, only for the two to part ways after a brief convergence — a pattern that could easily repeat.

Hisham Dawood, a researcher at the French National Center for Scientific Research, says Iraq’s Shi’ite political community has been fracturing since 2009, when al-Maliki chose to run independently to assert his leadership, triggering tensions that were only later resolved under Iranian pressure amid the rising challenge from the secular Iraqiya bloc led by Ayad Allawi.

Today’s fragmentation of the Coordination Framework, Dawood argues, is part of a broader regional unraveling.

“The Gaza war, Hezbollah’s setbacks in Lebanon, the collapse of Assad’s regime in Syria, and the intensified strikes on the Houthis in Yemen — all point to a shifting Middle East,” he said.

These changes are forcing Iran to re-evaluate its strategy in Iraq. “How does it preserve its strategic gains?” Dawood asked. A senior Dawa figure close to al-Maliki suggested Iran may be deliberately signaling non-interference, focusing instead on internal stability and recalibrating its foreign policy.

“Iran might be letting its allies clash now, confident they will come back to it in the end,” said another senior Shi’ite leader. “Only Iran knows how to tie the final knots.”

Iraq seen as Iran’s potential ‘Sacrifice’ amid regional retreat

A senior figure in Iraq’s Dawa Party believes Iran may be prepared to let Iraq become the next “sacrifice” in a string of strategic retreats, following Syria, Lebanon, and Yemen — all in a bid to protect Tehran’s political system from collapse.

“To avert a major threat, Tehran could even offer up Iraq,” the politician told Asharq al-Awsat. “But the Iranians never truly change. They will never accept pulling back from the region. They will return — it’s only a matter of time.”

Despite Iran’s subdued profile in Iraq’s pre-election landscape, many within the Shi’ite-dominated Coordination Framework remain unconvinced that Tehran has really stepped away.

“There are key interests here that require a watchful eye,” one member of the alliance said, speaking on condition of anonymity. “And Iran’s network is far from absent,” they added.

According to insiders, multiple power centers within Iran are involved in the Iraq file — including the Quds Force, the Iranian Revolutionary Guard Corps (IRGC), Iranian intelligence, the office of Supreme Leader Ali Khamenei, and even individuals within his family.

“Each has its own preferences and interests when it comes to Iraq’s elections,” one official said.

Dawood underscored Iraq’s strategic weight for Tehran: “Iraq is not Syria, and not even Lebanon. It is Iran’s largest commercial market and a vital land bridge to the Mediterranean.”

Indeed, while Iran’s presence may no longer dominate Baghdad’s political scene, Qaani’s team has held discreet meetings with key Shi’ite figures to ensure “everything remains under control.”

Negotiators working on election alliances say Tehran is still involved — but from a distance.

“They have two clear priorities,” one strategist said. “Reducing the number of competing lists to avoid fragmentation, and ensuring that major armed factions are integrated into broad alliances.”

When Asharq al-Awsat asked leaders of armed groups whether they planned to participate in the elections, most said they had not yet decided — or that the vote was not their concern.

Kazem al-Fartousi, a leader in the Kata'ib Sayyid al-Shuhada Brigades, acknowledged the tension: “We don’t readily accept participating in the elections, even if we’re convinced that they are the foundation of Iraq’s political system.”

‘The kids have grown’

Iran’s waning influence in Iraq is not only the result of a weakening “Axis of Resistance” across the region — it’s also because “the kids have grown up,” says Dawood, referring to Iraq’s powerful Iran-backed militias and factions.

“These groups now have their own patronage networks and strong local interests inside Iraq,” Dawood told Asharq al-Awsat. “They can no longer be controlled through blind loyalty to Tehran.”

Until recently, Iran-aligned factions were more responsive to pressure from Tehran, Dawood explained. “At the time, their interests aligned closely with Iran’s. These factions lacked a social base, funding, and military experience — they were reliant on Iranian backing.”

Today, many of those same groups form the core of al-Sudani’s government — “no longer operating on the sidelines, but from within,” Dawood said. The evolution presents what he calls a “structural crossroads” for Iraq’s armed groups.

“They now face a stark choice,” he said. “Either preserve their strategic gains by dismantling their armed wings and integrating their fighters into state institutions, or risk mounting regional and international threats — particularly after the political earthquakes in Syria.”

This growing assertiveness is already visible within the Coordination Framework, where Shi’ite parties are increasingly engaging in open political competition with fewer restraints. According to senior Shi’ite officials, these intra-Shi’ite rivalries continue to play out under “remote Iranian monitoring,” but with far less direct interference than in the past.

Power struggle between Maliki and Sudani

A simmering rift within Iraq’s ruling Shi’ite coalition has spilled into public view, as al-Sudani and al-Maliki clash over control of the government and the future of the Coordination Framework ahead of the 2025 elections.

In early January, Ammar al-Hakim, leader of the Shi’ite “National Wisdom Movement,” broke the silence over tensions brewing inside the coalition. He pointedly reminded allies that al-Sudani, who once held a lone parliamentary seat, owes his rise to the premiership to the Coordination Framework — and should not attempt to chart his own course.

“Some coalition leaders are asking: why empower someone who now seeks to outgrow us?” Hakim said, framing al-Sudani’s independence as a betrayal.

According to a political advisor who served in previous Iraqi cabinets, the coalition is grappling with what he calls “the Prime Minister complex” — the tendency among Shi’ite leaders to resist any premier who gains too much personal influence. al-Maliki, who held office from 2006 to 2014, is among those alarmed by al-Sudani’s growing stature and regional outreach.

“Al-Sudani is replicating al-Maliki’s first term,” the advisor told Asharq al-Awsat, “leveraging a strong central state and public sector to cultivate loyalty.”

 

That strategy, however, has triggered anxiety inside the Framework. A senior figure in al-Maliki’s Dawa Party said al-Maliki is uneasy with how al-Sudani manages the cabinet and bypasses consensus mechanisms. “We are now dealing with a prime minister with unchecked authority,” he said.

The tensions reached new heights when al-Sudani traveled to Qatar and met Syrian President Ahmed al-Sharaa without coordinating with his political allies — moves seen by some as an attempt to position himself as a regional powerbroker.

The Dawa official warned that “landmines are planted in al-Sudani’s path,” and he will need “considerable strength” to navigate them ahead of the vote.

Iraq’s political arena is no stranger to explosive conflicts, but al-Sudani is testing these waters for the first time — and with competing agendas in his head, according to a veteran political figure. “He’s trying to manage opposing plans simultaneously,” the source said.

Despite Tehran’s reduced visibility, Iranian actors continue to wield influence, often behind the scenes. One source said Iran has pressured al-Sudani to include certain armed factions in his circle as a means of securing his position and protecting Tehran’s interests. “Iran sees al-Sudani as a difficult but valuable figure — not someone to discard easily.”

Members of al-Sudani’s Furatain Bloc declined to comment on his election strategy. However, sources close to coalition talks confirmed that al-Sudani has clashed with Badr Organization leader Hadi al-Amiri over the leadership of a joint electoral list.

According to these sources, al-Sudani demanded to head the alliance and called for a pledge supporting his bid for a second term — conditions viewed as excessive by Amiri’s camp.

Political analysts say al-Sudani is seeking to break free from the shadow of the Coordination Framework’s first-generation leadership, especially those associated with hardline regional agendas such as the “Al-Aqsa Flood” rhetoric. Yet, aware of the political landmines ahead, he is carefully courting allies who can shield him from the fallout.

“Color of the cat doesn’t matter”: Iran adapts its Iraq strategy amid shifting regional dynamics

Iran appears to have recalibrated its approach to Iraq, learning from past overreach and embracing a more pragmatic stance that reflects regional shifts and American influence, analysts and political insiders say.

Tehran’s introspection dates back to the tenure of former Iraqi Prime Minister Adel Abdul Mahdi (2018–2019), a period viewed by Iraqi protesters and civil movements as “tragic.”

At the time, Iran was emboldened by what it saw as the decline of US influence in West Asia and pushed to consolidate its hold over Iraq, according to a former Iraqi government advisor.

Abdul Mahdi, a seasoned figure with roots in the Tehran-founded Islamic Supreme Council of Iraq, oversaw a period during which pro-Iran factions expanded their parallel state structures. But the October 2019 protest movement disrupted that momentum, triggering a political realignment — despite the deaths of over 600 demonstrators.

“Tehran realized it had overplayed its hand,” the former advisor told Asharq al-Awsat. “Since then, it’s returned to a more measured formula.”

Dawood said Iran has spent the past two decades convincing — or compelling — Washington to share responsibility for Iraq’s political management. “This dual oversight between the US and Iran often drives the reconfigurations we see in Iraqi politics,” he said.

The former advisor likened Iran’s flexibility to Deng Xiaoping’s famous adage: “It doesn’t matter what color the cat is, as long as it catches mice.” Iran, he said, demonstrated this mindset during the war against ISIS, and even earlier.

He recalled how, before the 2003 US-led invasion of Iraq, Iran issued religious rulings allowing Shi’ite factions to cooperate with the United States — despite Tehran’s official position branding it the “Great Satan.” That green light cleared the way for opposition figures to travel to Washington in preparation for the Gulf War.

On the other side of Iraq’s fractured Shi’ite landscape, secular-leaning politicians see an opportunity. One such figure, who spoke to Asharq al-Awsat on condition of anonymity, said he had visited Washington twice — before and after Trump’s inauguration in January 2025.

“The next elections must reflect the transformations sweeping the region,” he said. “If they don’t, Iraq risks being left behind in the emerging Middle East order.”

Iran’s ‘plan B’: quiet calculations in Iraq ahead of 2025 elections

Iran is recalibrating its presence in Iraq, balancing public restraint with behind-the-scenes maneuvering as it braces for a pivotal election season. While Tehran’s footprint appears subdued, political sources say its operatives are quietly managing a fallback strategy — “Plan B” — from the shadows.

Two competing narratives dominate assessments of Iran’s current posture. One holds that Tehran is intentionally keeping a low profile in Baghdad to avoid provoking Washington and to demonstrate its commitment to ongoing negotiations. The other suggests Iran is overstretched at home but will inevitably return to assert itself more forcefully.

But behind the scenes, commanders aligned with Esmail Qaani, head of Iran’s Quds Force, are actively adjusting political calculations in Baghdad, according to Shi’ite political insiders.

Leaked details from high-level meetings in the Iraqi capital indicate that Tehran is seeking to secure three key objectives before the November 2025 elections: prevent the emergence of a Shi’ite faction that could challenge its influence in the future, preserve a carefully curated balance of electoral competition among Iraq’s Shi’ite parties, and keep both al-Sudani and al-Maliki politically viable — even if they remain rivals.

"Al-Sudani could be Tehran’s strategic bet if talks with Washington succeed, while al-Maliki may prove crucial if they fail," a senior figure in Iraq’s Dawa Party told Asharq al-Awsat.

Iran is currently working to keep Shi’ite political rivalries from escalating into violence, but the same Dawa official warned that “Plan B” would see Tehran decisively back one faction — particularly if the powerful Sadrist movement reenters the political fray.

Sources familiar with the thinking inside the Sadrist camp said the bloc is deliberately delaying any announcement on whether it will contest the elections, hoping to catch its rivals off-guard and reduce their ability to mobilize against it.

A business of politics

Iraqi elections increasingly resemble a high-stakes entrepreneurial summit, where political newcomers and veterans alike jockey to raise their stakes in power.

“Everyone is in it to boost their influence,” said a former Shi’ite candidate who ran in Iraq’s first two post-2003 elections. “For many newcomers, this is their shot at entering the club of political elites.”

The retired candidate, now observing from the sidelines, said Tehran is grappling with a generation of loyalists who have matured into power brokers.

“Some of them now have access to state contracts and resources. They’re strong enough to donate to the Revolutionary Guard — not the other way around.”

This complex and shifting power dynamic alarms researchers like Dawood, who warned that two decades of Shi’ite rule have delivered disappointing outcomes.

“What we’ve seen is a rentier economy entirely dependent on oil, a complete absence of economic vision, and little understanding of how to govern a complex society,” Dawood said. “Add to that a lack of market knowledge, limited regional or global connectivity, and a systemic fusion of diplomacy with ideology — plus entrenched corruption.”

As Iraq approaches its next election, Dawood sees two parallel tracks hurtling toward November 2025: the failure to build a rational state model, and intensifying regional and international pressure.

 



At a Gaza Zoo, War Takes Its Toll on the Animals

A female lion sleeps inside a cage at a zoo in Nuseirat, in the central Gaza Strip, August 12, 2026. (Reuters)
A female lion sleeps inside a cage at a zoo in Nuseirat, in the central Gaza Strip, August 12, 2026. (Reuters)
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At a Gaza Zoo, War Takes Its Toll on the Animals

A female lion sleeps inside a cage at a zoo in Nuseirat, in the central Gaza Strip, August 12, 2026. (Reuters)
A female lion sleeps inside a cage at a zoo in Nuseirat, in the central Gaza Strip, August 12, 2026. (Reuters)

As children walked into the zoo near Gaza's Nuseirat refugee camp, they found a lion barely looking back at them through the bars of its cage and chimpanzees sitting listlessly in their enclosure.

Many of the animals were malnourished, weakened by shortages of food, medicine and vaccines. But they were still alive, largely thanks to the efforts of zoo owner Mahmoud Gomaa.

He originally ran the attraction in the southern city of Rafah, but said he had to flee when Israeli troops attacked and occupied part of the area in 2024.

As the conflict raged, he moved the surviving animals from town to town before finding a place in Nuseirat ‌in central Gaza earlier ‌this year.

There, he reopened the zoo, hoping to give traumatized youngsters ‌something ⁠to enjoy after ⁠nearly three years of destruction.

ZOOKEEPER RETURNED TO FIND ANIMAL BONES

"In the beginning of the war people were looking for a way to survive ... and I was looking for a way to save the animals more than saving myself," Gomaa told Reuters.

There were a number of zoos in Gaza before the conflict between Israel and Hamas erupted, displaying exotic and wild animals including lions and eagles, municipal records show.

Anyone trying to keep one open now faces enormous challenges, ⁠vets and animal experts said, not least in getting food in ‌a territory struggling to feed its human population.

"Owners ‌are currently feeding them frozen meat," veterinarian Nidal Fadel said. "This is a catastrophe and a wrong nutritional plan ‌because in nature they eat fresh prey."

Palestinian children play outside a zoo damaged during the war, in Gaza City, August 15, 2026. (Reuters)

The animals themselves are bearing the brunt ‌of the war — sometimes directly.

When Gomaa fled Rafah, he said he had to leave behind three lions, several crocodiles and some African ostriches.

A few months later, Gomaa returned and only found the bones of the crocodiles and the ostriches. Those three lions, which he had locked in their cages, had ‌disappeared.

There is also the trauma caused by the sound and sight of the conflict raging around them.

"Lions can detect sounds and ⁠disturbances that humans may not ⁠notice," said Amir Khalil, a veterinarian who has led several trips to Gaza by the animal welfare organization Four Paws and rescued other zoos' animals.

"Bombing and constant conflict create enormous stress and fear for them," he added.

In Nuseirat, the surviving lion barely looked up at the visitors. But the children had better luck with some of the other animals, letting parrots ride on their shoulders and petting smaller monkeys.

It was a rare chance to relax in an enclave still facing regular airstrikes, despite a fragile ceasefire. Israel's military, which says its attacks are aimed at militant targets, did not immediately respond to questions about the conflict's impact on civilian facilities like zoos and their animals.

"Today there is no avenue for children to play," said visitor Karam Al-Mazin, 42.

"There is nothing except rubble, stones and tents, so children today are bored and are in a difficult situation."


The 60-day Deadline for an Iran Peace Deal is Expiring. Here's Where Things Stand

A woman holds an Iranian flag as part of a pro-government campaign in downtown Tehran, Iran, Monday, Aug. 17, 2026. (AP Photo/Vahid Salemi)
A woman holds an Iranian flag as part of a pro-government campaign in downtown Tehran, Iran, Monday, Aug. 17, 2026. (AP Photo/Vahid Salemi)
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The 60-day Deadline for an Iran Peace Deal is Expiring. Here's Where Things Stand

A woman holds an Iranian flag as part of a pro-government campaign in downtown Tehran, Iran, Monday, Aug. 17, 2026. (AP Photo/Vahid Salemi)
A woman holds an Iranian flag as part of a pro-government campaign in downtown Tehran, Iran, Monday, Aug. 17, 2026. (AP Photo/Vahid Salemi)

The deal that US President Donald Trump signed at Versailles in June set an ambitious 60-day deadline for ending the war with Iran and reaching an accord on its nuclear program.

The deadline was Monday, and the two sides are further apart than they were then, The Associated Press said.

Talks, such as they are, have focused on reopening the Strait of Hormuz and lifting a US blockade on Iran, both of which were supposed to have happened under the interim deal. There has been no sign of any compromise on the strait, or that detailed nuclear talks have even begun.

The US, meanwhile, has no good options for getting out of the war it started alongside Israel.

Acceding to Iran's latest demands would mean giving it control over a critical international waterway that carried a fifth of the world's traded oil and gas before the war — and would be tantamount to admitting defeat. Escalating the deeply unpopular war would further draw down US supplies of advanced missile interceptors, jolt the world economy, and drive up gas prices ahead of US congressional elections.

So both sides have dug in, hoping the other will blink first. So far, neither has.

The interim deal collapsed weeks later

The June deal, known as the Memorandum of Understanding, called for a halt to all military operations and set a 60-day deadline for an agreement to permanently end the war and resolve the longstanding dispute over Iran's nuclear activities.

It called for the Strait of Hormuz to be reopened but gave Iran a vaguely defined role in facilitating traffic, leaving open the possibility it could charge fees after the 60-day deadline. Iran has seized on that clause to claim control over the waterway.

A week after the deal was signed, Iran began firing on vessels using a route along the coast of Oman, on the other side of the strait, that is overseen by the US military and intended to bypass Tehran's control.

The US responded by striking Iran, which retaliated by attacking Arab countries hosting American forces, like Jordan, Kuwait and Bahrain. The US canceled waivers issued as part of the deal that had allowed Iran to sell its oil internationally and Trump restored a blockade of Iran's ports.

Each side accused the other of violating the June agreement, of which almost nothing remains.

The fighting eventually died down. A related truce in Lebanon between Israel and the Iran-backed Hezbollah has mostly held, even as Israeli troops occupy large areas in the country's south. Lebanon's "territorial integrity and sovereignty" were to have been ensured under the June deal.

Iranian officials say they stopped negotiating with the US in June, while acknowledging that messages have been relayed by intermediaries. Trump says the talks have continued, occasionally claiming progress after pulling back from threatening major strikes.

Pakistan, which played a key role in brokering the June agreement, noted last week that the deadline was Monday while expressing hope it would be extended.

“We are not closing the chapter,” Foreign Ministry spokesman Tahir Andrabi said. “Pakistan is making all-out efforts to bring the two parties to the negotiating table.”

Iran's leaders think they can force Trump to give up the strait

Earlier this month, Iran issued a list of demands for reopening the strait, including the lifting of the American blockade, the withdrawal of US forces from around Iran and the payment of reparations for damage inflicted in the war started by the US and Israel on Feb. 28.

Even then, Iran has said it would control the strait — and potentially charge fees — through an agreement it is negotiating with Oman, and that the strait will not go back to being an open, toll-free waterway as it was before the war.

Iran-backed Houthis in Yemen have meanwhile begun attacking oil tankers in the Red Sea, threatening another crucial trade route that had been used to relieve some of the pressure from the strait being closed.

Trump has rejected Iran's demands — saying it's Tehran that should pay war reparations and claiming the US controls the strait. He appears to be banking on economic pressure — in the form of the blockade and longstanding sanctions — to bring Iran's rulers to their knees.

Iran's economy has been battered by the war and isolation, and inflation has soared. The crisis could stoke renewed anti-government protests, like those that were brutally crushed in January.

Traffic through the Strait of Hormuz, which rose immediately after the interim deal, is back to a small fraction of what it was before the war. Rising prices of fuel and other goods are expected to climb further the longer this continues with effects far beyond the Middle East.

The clock is still ticking for both sides.


Battered by War, Iran’s Rulers Wary of More Economic Pain and Unrest if US Tightens Pressure

People walk in the Grand Bazaar in Tehran, Iran, August 17, 2026. Majid Asgaripour/WANA (West Asia News Agency) via Reuters
People walk in the Grand Bazaar in Tehran, Iran, August 17, 2026. Majid Asgaripour/WANA (West Asia News Agency) via Reuters
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Battered by War, Iran’s Rulers Wary of More Economic Pain and Unrest if US Tightens Pressure

People walk in the Grand Bazaar in Tehran, Iran, August 17, 2026. Majid Asgaripour/WANA (West Asia News Agency) via Reuters
People walk in the Grand Bazaar in Tehran, Iran, August 17, 2026. Majid Asgaripour/WANA (West Asia News Agency) via Reuters

Even as Iran projects resilience in the war with the United States, its leaders are worried that a threat of more economic punishment by Donald Trump could increase hardships, reignite unrest and further erode the regime’s legitimacy.

The US president vowed on Friday to hit Iran hard economically, a day after Treasury Secretary Scott Bessent said Washington would impose measures on Tehran that have "never been seen" as early as next week. Washington has not said what those measures will entail.

For all the bravado of Iran's leaders after holding out in nearly six months of conflict and effectively closing the Strait of Hormuz, a vital global oil supply route, they face mounting pressure at home that could result in nationwide unrest, according to three Iranian officials.

The officials, two political insiders, a former Iranian official and a dozen ordinary Iranians spoke to Reuters for this story on condition of anonymity, either for fear of retribution or because they are not authorized to speak to media.

Iran entered the war with high inflation, a weakening currency, energy shortages, sanctions and deep structural weaknesses, and must now contend with damaged infrastructure, disrupted trade, lost production and the cost of rebuilding.

Arshia, a civil engineer, spent a decade working in Iran’s construction industry before the war that began with US and Israeli attacks on February 28 brought projects largely to a standstill.

He is now struggling ‌to find work as ‌projects are delayed or cancelled and costs soar, with little prospect of a rapid recovery.

"I’m worried. If Trump imposes ‌more sanctions, ⁠how will ordinary ⁠people survive? I don’t want my country to be punished militarily or economically. We’re already struggling,” said the father of two from the central city of Isfahan.

His plight reflects a broader reality across Iran, where US strikes damaged factories, power plants, transport networks and other critical infrastructure, adding to pressure on an already strained economy.

Mohsen, 53, was forced to shut his small import-export business with Gulf countries after Iran retaliated against US strikes by targeting American bases and assets in the region.

"I had to lay off 10 employees. It was painful, but I had no choice. I could no longer afford to pay their salaries, and now I’m relying on my savings to support my family," he said from the southern port city of Bandar Abbas.

INFLATION, UNCERTAINTY HIT HOUSEHOLDS

Iran’s annual inflation rate reached 66% in July, while consumer prices were 87.9% higher than a year earlier, according to Iran’s Statistical ⁠Center. Food inflation hit 128% year-on-year.

For Iran’s rulers, the greater threat may be not economic pain itself, but the risk ‌that worsening hardship reignites mass unrest, said the two insiders and one official.

The appointment of Hossein Taeb ‌last week, a key architect of past crackdowns, to lead Iran’s Basij militia is one of the clearest signs yet of growing concern over a resurgence of unrest, a former reformist ‌official said.

The Basij, a paramilitary volunteer militia, is affiliated with Iran's powerful Revolutionary Guards, which have both been used by the clerical rulers to quell protests.

Economic ‌grievances have repeatedly spilled into nationwide protests in Iran in recent years.

In January, nationwide protests over economic hardships were crushed by the IRGC and the Basij force, with thousands killed.

In recent months, Iran’s clerical rulers have responded to fears of renewed unrest with executions, arrests, summonses and lengthy prison sentences targeting journalists, lawyers, activists, human rights advocates and students, rights groups say.

Officials say the measures are needed to maintain stability during wartime. Critics say they could deepen the divide between the clerical establishment and a public frustrated by rising economic pressures.

SALARY 'GONE WITHIN DAYS'

Families are cutting ‌back on meat and other staples, opting for cheaper alternatives.

"I’m ashamed in front of my children. My salary is gone within days. Meat and chicken have disappeared from our table. I have no idea how we’re going to ⁠get by," said Hossein, a government employee in ⁠the central city of Yazd.

Rents rose 31% year-on-year in March, according to the Statistical Centre, while state media reported Tehran housing prices at roughly 50% above last year.

Iran’s minimum wage was raised by about 60% this year, but continued rial depreciation has eroded purchasing power, with the dollar value of the minimum wage falling from about $105 to $86 since late March.

Bijan, 40, earned about $1,000 a month as an engineer when he entered the job market 15 years ago. He has since turned to online tutoring to make ends meet. Now, he and his wife struggle to make about $400 a month and have left Tehran for a cheaper province.

"I used to work maybe five or six hours a day ... Now, it’s all work or looking for work, or feeling anxious about not having enough work," said Bijan.

For many Iranians, fear of renewed conflict has made planning for the future increasingly difficult.

US NAVAL BLOCKADE RATCHETS UP COSTS

Iran has sought to keep essential goods moving through alternative routes, including land corridors and the Caspian Sea, but those alternatives are also coming under strain.

Strikes on bridges have disrupted overland transport, increasing the cost and time needed to move goods into Iran.

President Masoud Pezeshkian last week acknowledged the squeeze, saying: “Our problems have multiplied several times over, while our income has also fallen.”

Goods that once arrived by ship now take longer routes into Iran, driving up prices, he said, adding that Iran is selling less oil and collecting less tax revenue from damaged or struggling businesses.

The blockade has also effectively cut off Iran’s gasoline imports, lawmaker Reza Sepahvand told Iran's ILNA news agency on Saturday, adding that Iran’s daily gasoline output had reached its limit at about 130 million liters, compared with consumption of 137 million liters.