Rials, Roaring Anger, Riots... Inflation Fuels Fury in Tehran: Protests, Poverty, and the Fight for Survival....

From Bazaar to Barricades: Unrest, Economic Strife, and Political Challenges Shape a Nation’s Future

Tehran’s historic bazaar, a vital artery of Iran’s commerce and a symbol of its cultural heritage, has become the epicenter of growing unrest as the country grapples with an unprecedented economic crisis. Over the weekend, merchants and workers staged strikes and protests against surging inflation and the devaluation of the rial, echoing the historic role the bazaar played during the 1979 Islamic Revolution. This unrest is part of a broader tapestry of discontent woven by decades of economic mismanagement, international sanctions, and political turbulence.

The protests began among shoe sellers in the bustling 15th Khordad district and quickly gained momentum, spreading to other sectors within the bazaar and beyond. Merchants chanted slogans such as “Don’t be afraid, close up” and “Brave merchants, support, support,” reflecting a palpable frustration with the government’s handling of the economy. A fabric merchant cited the soaring cost of raw materials and the rial’s plummeting value as crippling obstacles for businesses. “With the dollar now above 810,000 rials, our expenses have skyrocketed,” he lamented. “Many workshops have shut down, and even those still running are struggling to sell goods in such a sluggish market.”

Iran’s economic woes are staggering. The national currency has lost nearly 50% of its value over the past year, pushing at least one-third of the population below the poverty line. The Iranian rial’s depreciation has not only increased costs for businesses but also reduced consumer purchasing power, creating a vicious cycle of economic stagnation. Compounding the crisis are chronic energy shortages, including rolling blackouts and natural gas deficits, which have disrupted daily life and industrial operations.

Government’s Response: Balancing Repression and Deflection

The government has responded with a mix of repression and deflection. Security forces were deployed to quash the protests, and Tehran’s judiciary chief, Gholamhossein Mohseni Ejei, has called for decisive measures to prevent further unrest. Speaking to prosecutors and law enforcement agencies, Ejei emphasized the need to “stabilize and strengthen the security of the people,” framing the protests as part of a foreign conspiracy orchestrated by Iran’s adversaries, particularly the United States and Israel.

The Islamic Revolutionary Guard Corps (IRGC) has echoed these sentiments, issuing a statement on the anniversary of the December 30th pro-government rallies, known as “Dey 9.” The IRGC accused foreign powers of waging economic and cognitive warfare against Iran, aiming to destabilize the regime by fostering despair and hopelessness among its citizens. This narrative, while resonating with the government’s base, does little to address the root causes of the unrest.

Energy Crisis and Economic Mismanagement

Iran’s energy crisis underscores the broader challenges facing its economy. Despite sitting on vast reserves of oil and natural gas, the country has struggled to meet domestic demand due to years of underinvestment and the impact of Western sanctions. The situation has been exacerbated by falling gas pressure in Iran’s main production fields in the Persian Gulf, where technological expertise from Western companies is sorely needed but unavailable due to sanctions.

To cope with a 30% shortfall in natural gas supplies, Iran has resorted to burning heavy oil mazut, a highly polluting alternative that has shrouded cities like Tehran in dense smog. The health and economic costs of this stopgap measure are immense, with air pollution leading to widespread closures of schools, universities, and government offices. These shutdowns are costing the economy an estimated 50,000 billion rials ($63 million) daily, further straining a fragile fiscal landscape.

Businesses, meanwhile, are struggling to pay wages amid reduced hours and operational disruptions. The government’s plans to increase tax revenues by 39% in the next fiscal year seem increasingly unrealistic in this context, with many companies teetering on the brink of insolvency.

Historical Parallels and a Nation on Edge

The current unrest draws inevitable comparisons to previous uprisings in Iran’s modern history. In 2019, violent protests erupted after the government abruptly tripled gasoline prices, leading to hundreds of deaths and widespread arrests. More recently, the 2022 protests following the death of Mahsa Amini in morality police custody highlighted the deep-seated grievances of a population yearning for political and social freedoms.

Supreme Leader Ayatollah Ali Khamenei has sought to deflect blame for these crises onto foreign powers, warning that those who align with the West will face severe consequences. However, this rhetoric rings hollow for many Iranians, who see the government’s mismanagement and repressive policies as the primary culprits behind their hardships.

Iran’s leadership now faces a critical choice. Without significant reforms to address the economic and political grievances of its people, the regime risks further alienation and unrest. Yet, such reforms would require a fundamental shift in its foreign policy and governance model—an unlikely prospect given the entrenched power of hardliners.

As Tehran’s historic bazaar falls silent and smog blankets the city, the question looms: How long can the government maintain its precarious grip on a nation increasingly pushed to the brink?