100 days after carnage: Iran economy reels from war, inflation, unemployment

The man has not been named. Sources say he was a professional working in the area and a peaceful opponent of the Iranian government.

The attack comes at a time of growing concern about threats, intimidation, and violence affecting people linked to Iran in Britain.

On Friday, British police charged three people over an attempted arson attack near the London offices of Iran International. Police said a burning container was thrown towards the broadcaster’s headquarters in north-west London. No one was injured, but the case has added to concerns about the safety of Persian-language media in Britain.

Before that, in March 2026, an Iran-aligned group was reported to have claimed responsibility for an arson attack on Jewish ambulances in Golders Green, north London.

In May 2025, three Iranian men were charged under the National Security Act after a major counter-terrorism investigation. Prosecutors said one of the men had carried out surveillance, reconnaissance, and online research with the aim of committing serious violence against a person in the UK.

The other two were accused of similar activity intended to help others carry out serious violence. The Home Secretary said the case was part of a broader response to threats linked to the Iranian state.

British authorities have warned for several years that Iran poses a serious threat on UK soil.

In October 2024, the head of MI5, Ken McCallum, said the security service and police had responded to 20 Iran-backed plots since January 2022 involving potentially lethal threats to British citizens and UK residents. He said many of the cases were linked to opponents of the Iranian state living in Britain.

The full circumstances of this latest assault are not yet public. But for many in the Iranian community, the message will already be clear. It will be seen as part of a wider climate of fear facing Iranians in exile, especially those who oppose the government in Tehran.

Roughly 21 million barrels per day of oil and petroleum products normally transit the strait. That volume accounts for one fifth of global petroleum liquids consumption and one quarter of all seaborne traded oil.

Yet the destinations of those flows expose the asymmetry that ultimately doomed the strategy.

In the first half of 2025 ~89% percent of crude oil and condensate flowed eastward to Asian markets.

China absorbed 37.7 percent of the total followed by India at 14.7 percent South Korea at 12 percent Japan at 10.9 percent and other Asian buyers at 13.9 percent.

Europe received just 3.8 percent and the United States only 2.5 percent. The IRGC was never holding the West hostage. It holds the East.

By throttling traffic during the conflict the regime exercised its only economic "card". Ship transits collapsed to under ten percent of normal levels even after the ceasefire. Insurance rates soared and oil prices spiked.

The move they thought would delivered short term tactical breathing room and helped force negotiations. Yet the decision transformed a potent deterrent into a wasting asset.
The primary victims were Asian importers especially China and India. Those nations faced immediate cost spikes and supply uncertainty.

Beijing responded by drawing down its strategic petroleum reserve which covers more than four months of imports while accelerating purchases of Russian African and Latin American crude.

India pursued parallel diversification.

More critically Persian Gulf producers gained the political urgency and capital they needed to lock in permanent bypass infrastructure.

Saudi Arabia ramped its East West Petroline to near its seven million barrels per day capacity routing crude to Red Sea terminals at Yanbu.

The United Arab Emirates expanded the Abu Dhabi Crude Oil Pipeline to Fujairah on the Gulf of Oman. Additional overland proposals and expanded export terminals emerged almost immediately.

Once those routes reach commercial scale the strait loses its status as a global chokepoint. It becomes a regional inconvenience whose disruption matters far less to the broader market.

Simultaneously United States crude exports have surged to a record 4.9 million barrels per day in April 2026 with forecasts pointing toward five million or higher in coming months. That volume covers roughly 23 percent of normal full Hormuz traffic and about one third of the crude and condensate segment.

Asian refiners have redirected demand toward US Gulf Coast barrels to fill the shortfall from Middle East shut ins estimated at 7.5 to 9.1 million barrels per day. The surge not only caps price spikes but also cements American producers as the flexible swing supplier to Asia.
This development accelerates the very diversification that erodes Iranian leverage.

The one year five year and ten year horizons reveal starkly divergent outcomes.

For IRGC the picture darkens at every stage. In the first year oil revenues collapse despite temporary price spikes because export volumes remain minimal. The economy already contracting from war damage and sanctions faces hyperinflation in food prices and widespread shortages.
Over five years bypass pipelines and alternative supply chains become permanent fixtures. Petrodollar inflows never recover and sanctions compound the isolation.

By year ten Iran confronts structural marginalization as a secondary supplier at best. Internal pressures from economic rot and factional rivalry mount inexorably.

The regime is forced to move first. It cannot sustain years of revenue denial while rivals reroute around it. Diplomatic capitulation or escalated domestic repression becomes inevitable well before the five year mark.

China absorbs the heaviest short term pain yet emerges stronger. Higher import costs slow some refinery runs in the first year but strategic reserves Russian pipelines and surging United States imports prevent outright shortages.

Over five years Beijing locks in new sourcing habits and accelerates renewables and domestic production. By year ten China enjoys markedly improved energy security with far less exposure to any single chokepoint. The crisis ultimately serves as an expensive but effective catalyst for diversification but shines a light on Chinese dependency on US rendering any multipolar aspirations null, China isn't a pole probably never was if it can't survive without IRGC cheap oil paid with the blood of Iranians.

The United States stands as the unambiguous winner across all horizons. Export revenues boom in the first year as shale producers respond to sustained high prices.

Over five and ten years America solidifies its role as the reliable Atlantic basin supplier to Asian demand. Strategic leverage deepens without proportional domestic pain.

Arab states astride the Persian Gulf also gain by converting crisis into durable infrastructure and expanded market access.

In strategic terms the IRGC executed a classic use it or lose it blunder. By weaponizing the eastern hostage it compelled the very adaptations that render the hostage irrelevant. Global energy flows have begun a permanent eastward rerouting that favors flexible producers over vulnerable chokepoint holders.

The 2026 crisis therefore accelerates the long term isolation of Iran. It diminishes the regime's economic shield permanently and hastens the internal collapse dynamics already evident before the conflict.

What began as a tactical gambit to survive immediate pressure has instead locked in decades of strategic decline. The geography of oil trade the scale of United States export capacity and the self interest of Asian importers have combined to ensure that the IRGC traded its last "card" for time it didn't get and burned what it could not afford to waste relevance and economic potential to climb out of the grave it dug itself.

The Hormuz closure wasn't a surprise to any serious person, one might argue Trump turned what the enemy believed to be a leverage to a ticking time bomb trap the IRGC just walked into.

IRGC was never the end goal, China is.

The video featured Julia Boutros, a Christian artist widely known across the Arab world for songs supporting Lebanese and Palestinian “resistance” movements.

In the footage shown on a large screen before a mixed-gender audience, she appeared without a headscarf.

For nearly half a century, broadcasting a female singer’s solo voice to male audiences has been prohibited in Iran. Women who have challenged this restriction, even in private concerts or online, have often faced harsh repercussions.

The public screening of Boutros’s performance at an officially sanctioned gathering therefore represents a striking departure from established norms, even if it may have occurred unintentionally.

Events like the rally typically require official permits, suggesting at least tacit approval by local authorities. Yet judicial bodies, which have historically acted quickly against perceived breaches of cultural or religious codes, have so far issued no public criticism of the incident.

Rallies evolving after ceasefire

The episode comes as the character of pro-government gatherings has been changing since the ceasefire that ended weeks of fighting nearly two weeks ago.

Social media posts increasingly depict the rallies as taking on a festival-like atmosphere. Families attend together, and for some participants the events appear to function as social gatherings as much as political demonstrations.

Large banners, video screens and coordinated staging are now common, while mosques and local Basij militia bases often serve as assembly points before crowds move toward central gathering locations.

These developments have also generated complaints from residents about late-night noise and traffic congestion, concerns widely discussed on social media.

Incentives and organization

There are also claims—difficult to independently verify—that participants are being mobilized through local institutions and offered incentives such as food, snacks or other benefits.

Photographs circulating online show numerous tents distributing free food and drinks, a practice consistent with the Shia tradition of nazri, in which charitable offerings are made during religious gatherings.

Images from recent days also showed senior military figure General Habibollah Sayyari helping prepare and distribute food at one such tent, highlighting the visible presence of state institutions at the events.

Pro-government celebrities from the film and sports worlds have also attended, with state media giving extensive coverage to their participation.

Political messaging intensifies

Hardline political groups have used the rallies as platforms for speeches and mobilization, with invited speakers addressing contentious issues such as whether Iran should accept ceasefire terms or pursue negotiations with the United States.

Some speeches have targeted prominent political figures, including former President Hassan Rouhani, former foreign minister Mohammad-Javad Zarif and Parliament Speaker Mohammad-Bagher Ghalibaf, encouraging crowds to chant slogans against them.

In one instance, a live broadcast of a speech by a religious performer was abruptly cut by state television and replaced with pre-recorded programming, suggesting heightened sensitivity to the messages being aired.

The rallies themselves were initially encouraged by senior officials as a demonstration of wartime solidarity. Earlier in the conflict, Ghalibaf called on citizens to take to the streets in support of Iran’s armed forces.

Yet the appearance of Boutros’s unveiled image on a giant screen at a pro-government gathering has underscored the contradictions between Tehran’s cultural restrictions and the messaging it seeks to project.

“I work as a freelance web developer and my income has dropped to zero because of the internet outage. I am selling my belongings to cover debts,” a citizen wrote in a message to Iran International.

Another said: “As a student and computer technician, I am stuck in uncertainty. Online classes are heavily disrupted, and I cannot even access the internet to complete projects. My workplace has no customers.”

NetBlocks said on Thursday the disruption had lasted 1,128 hours, describing the shutdown as unprecedented in scale for a country with deep reliance on global connectivity. The group added that its estimate, based on its COST methodology, also reflects wider social and human rights impacts.

Digital economy grinds to a halt

The outage has hit Iran’s digital sector, which had absorbed part of the country’s unemployment pressure over the past decade. Online businesses have lost access to customers, payment systems, and essential tools tied to the global internet.

The Rokna news website said on Wednesday the disruption amounted to a shutdown of the digital economy, noting that the cut to international internet access dealt a direct blow to online businesses.

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Hundreds of small digital enterprises have been unable to maintain sales, customer communication, or after-sales services. Layoffs have spread across technology firms and media organizations, affecting employees whose work depends on stable connectivity, the outlet added.

Journalists and media workers have also faced income losses and job cuts as communication channels narrowed and publishing operations slowed, according to the report.

Workers face mounting financial strain

“I managed to connect briefly using expensive VPNs, but I have lost my job due to the internet disruption. I have loans to repay and rent to cover, and many others are in the same situation,” another citizen told Iran International.

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  War and inflation batter Iran’s workforce

Accounts from across the country point to a broader slowdown. “Prices have increased several times over. Many people have lost their jobs. At least 50 percent of shops are closed,” one resident said, adding that only essential services such as repair shops and small markets remain partially active.

Delays in salary payments have become more common in some businesses, increasing pressure on workers already affected by rising prices. Inflation has further reduced real wages, leaving even those still employed struggling to cover basic living costs.

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Professional networks also reflect the downturn. Users on LinkedIn have publicly said they are seeking new job opportunities, indicating a rise in job seekers among skilled and experienced workers.

Experts warn of lasting damage

Economic journalist Arezoo Karimi said the losses extend beyond immediate income declines, warning of wider consequences for employment and growth.

“This means zero income for businesses that depend on international connectivity. It leads to layoffs and rising unemployment,” Karimi said, adding that daily losses run into tens of millions of dollars.

Karimi said the broader economic impact could reach several times the direct losses, pointing to reduced production and slower economic growth. Inflation, already elevated, is likely to worsen if disruptions continue.

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  Iran's digital economy battered by prolonged blackout

“Businesses are not only losing income, they are losing their position in international markets and online visibility. These are damages that cannot easily be reversed,” Karimi added.

With limited access to global markets and tools, many digital workers now face a choice between prolonged uncertainty and leaving the country.

The outage has exposed the dependence of Iran’s digital economy on stable international connectivity, with weeks of disruption enough to dismantle businesses built over years.

A letter issued by a senior official at the National Petrochemical Company instructed producers to stop exports and redirect supply to domestic industries.

The directive said the move aims to support downstream industries and consumers following damage caused by recent attacks and to ensure adequate supply in the domestic market, the report said.

Attacks, curbs hit sector

Domestic prices for petrochemical and related products have been held at pre-conflict levels despite rising global prices, officials said, adding the measures would remain in place to support local industry and consumers.

Companies were also told to return export cargoes that have not yet cleared customs, with associated costs to be reported for possible adjustments to domestic pricing.

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  Iran petrochemical workers face layoffs as industrial crisis deepens

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  Hope and anger in Iran as fragile ceasefire persists

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  War damage amounts to $3,000 per Iranian, with blockade set to add to losses

Key petrochemical hubs in Asaluyeh and Mahshahr have been hit in recent weeks, including strikes on utilities supplying feedstock to plants, disrupting production.

The US military has also begun blocking shipping traffic in and out of Iran’s ports this week, a move aimed at reducing Iran’s export revenues as Tehran and Washington consider a second round of talks.

Economic strain deepens

The measures come as Iran faces mounting economic pressure, with reports sent by citizens to Iran International describing factory closures and layoffs in industrial hubs due to shortages of raw materials and weak demand.

Residents said businesses have struggled with disrupted supply chains and an ongoing internet shutdown, which has further strained operations and added to rising prices.