Iran economic crisis deepens: Food prices rise, Rial at record low as US imposes new sanctions | Today’s news
Iran is facing a deepening economic crisis, with rising food prices, a rapidly weakening currency, fuel shortages and declining purchasing power putting increasing pressure on households. The latest U.S. sanctions campaign, dubbed “Operation Economic Outcast,” comes at a time when many Iranians are already struggling with a strained economy.
According to The Guardian, the economic crisis has become a parallel battleground for Iran’s leadership, which is increasingly concerned that deteriorating living standards could spark wider social unrest.
Food prices are rising
The sharp rise in the prices of basic goods has hit Iranian households particularly hard. Vegetable oil prices were reportedly 383% higher in August than a year earlier, while egg prices rose 294%, chicken 177% and red meat 148%, The Guardian reported.
The increase has forced many families to cut back on food and change their diets. The Guardian reported that demand for red meat fell by 50% in April 2026 compared to the same month the previous year.
In many households, spending decisions have shifted from major purchases to simply providing food and medical care.
The rise of inflation and the collapse of the Rial
Iran’s currency also suffered a decline. On August 23, the US dollar reached around 2 million Iranian rials in the open market, a new record.
Three days later, Iran’s statistics center reported that year-on-year inflation reached 84.4% in August, while the annual average inflation rate was reported to be about 65%.
The weakening rial has further eroded purchasing power, making imported goods and everyday necessities increasingly expensive.
Fuel shortages are contributing to the crisis
The economic problems have also spilled over into Iran’s fuel sector. Long lines of vehicles were reported in Tehran and Mashhad, and many gas stations were closed.
Officials attributed the disruption to panic buying following rumors of planned fuel price hikes and damage to oil storage facilities caused by Israeli strikes.
Leaders urged Iranians to cut consumption
Iran’s leaders are increasingly framing the economic struggle as part of the country’s confrontation with the US.
Hojatoleslam Taeb, head of the Basij paramilitary force, urged people to reduce their petrol consumption by up to 10%, suggesting that avoiding unnecessary travel was an act of patriotism.
Mohsen Rezaei, the secretary of Iran’s Supreme National Security Council, went further and advised young people to produce goods needed for themselves and society at home.
Economics magazine editor Mohammad Taheri compared the proposal to Mao Zedong’s disastrous “backyard steel furnace” campaign during China’s Great Leap Forward.
The export of oil remains a big challenge
The Guardian quoted energy expert Amirhossein Hashemi-Javid as saying that Iran’s main economic problem is the difficulty of exporting oil under the US blockade.
He warned that channels to sell Iranian oil were drying up, depriving the government of vital revenue while increasing the costs and risks of storing unsold oil.
Read also | Trump will use Venezuelan oil to replenish US oil reserves; deal details unclear
