As Tehran praises Moscow, critics ask where Russia was

Iran’s worsening economic crisis is drawing unusually blunt warnings from state media and establishment voices as war, inflation and shortages squeeze households and expose the limits of the government’s response.

The exchange rate for the US dollar surged again on Wednesday, April 29, climbing above 1.8 million rials.

That same day in downtown Tehran, a single fried egg cost one million rials and a hamburger five million—prices that bite hard in a city where minimum wage is just above 200 million rials a month.

“What is going on in this country, Mr. Pezeshkian?” state TV anchor Elmira Sharifi asked earlier this week, staring directly into the camera after reporting that many Iranians can no longer afford basic staples such as rice, sugar, cooking oil, fruit, dairy products and medicine.

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The exchange rate for the US dollar surged again on Wednesday, April 29, climbing above 1.8 million rials.

That same day in downtown Tehran, a single fried egg cost one million rials and a hamburger five million—prices that bite hard in a city where minimum wage is just above 200 million rials a month.

“What is going on in this country, Mr. Pezeshkian?” state TV anchor Elmira Sharifi asked earlier this week, staring directly into the camera after reporting that many Iranians can no longer afford basic staples such as rice, sugar, cooking oil, fruit, dairy products and medicine.

Had President Masoud Pezeshkian been watching, he might have been startled. State television rarely addresses officials so directly or publicly demands accountability. But he is no stranger to criticism. Calls for answers have become routine in the press and on social media.

His administration inherited a vast budget deficit, soaring inflation, high unemployment and widespread shortages. Those problems have worsened since he took office in 2024.

The war with the United States and Israel has deepened the crisis further, accelerating shortages, disrupting supply chains and giving officials a ready explanation for an economy already in freefall.

The government’s efforts to ease the burden have been criticized as too slow and too limited. Its latest initiative asks some supermarkets to offer goods on credit to customers unable to pay in cash.

Fars News, an outlet affiliated with the Revolutionary Guards, reported Tuesday that the government had approved a plan allowing households receiving cash subsidies to buy goods on credit, with repayments deducted from future handouts if necessary.

The measure, it said, is intended to support livelihoods and offset the economic consequences of the war.

But the plan has obvious flaws. It applies only to supermarkets that volunteer to participate, and repayments must be made within two months. More importantly, the monthly subsidy itself—worth less than seven dollars per person—barely buys anything.

Iran tried something similar in the 1980s during the war with Iraq, when cooperatives linked to ministries and the armed forces allowed employees to buy goods on credit and repay through their salaries.

Combined with ration books and coupons for essentials sold well below market rates, the system was widely seen as more efficient and more trusted than today’s improvised measures.

The announcement of the new credit-shopping plan came the same day Ettela’at, one of Iran’s oldest newspapers, issued a stark warning.

“The outlook of the war is entirely uncertain, and officials must focus on people’s livelihoods,” the paper wrote.

It warned that surging prices for essential goods, combined with unemployment, labor-market stagnation and the collapse of large parts of the production and supply chain due to war damage, had created a severe crisis.

The nationwide internet shutdown has only made matters worse.

Ettela’at said the current ceasefire could hold, collapse into a limited maritime conflict or spiral into broader war. In any scenario, it wrote, ensuring the livelihood, education, healthcare, security, food, housing, transportation, utilities, communications and employment of nearly 90 million Iranians requires urgent planning and “round-the-clock management.”

The paper concluded with another warning: the government may soon need special economic programs for wartime conditions, and they must be implemented urgently.

Whether officials can move fast enough—or govern coherently enough—to avert deeper hardship is another question.

The government’s Task Force for Food Security and Livelihood Improvement has announced that $1 billion from the National Development Fund will be allocated to import basic goods such as sugar, rice, red meat and animal feed.

The move comes alongside a broader policy decision to continue subsidizing critical imports despite earlier plans to scale back such support. It marks the second time in two years that the fund has been tapped to finance basic imports.

With reserves estimated at around $40 billion, the fund is also expected to help rebuild war-damaged industries, particularly steel and petrochemicals, highlighting growing tension over how these resources are prioritized.

'Nothing left'

For many Iranians, the strain is already becoming unbearable.

Nader, a 42-year-old film industry worker, says he has had no income since January, when nationwide protests began, and is preparing to leave his rental home and move his family into his parents’ house in another city.

“My wife’s job depended on the internet, and she has also become unemployed,” he said. “We’ve been using our savings to pay rent, but if we continue, soon nothing will be left for food or unexpected medical costs.”

The move also marks a reversal of the government’s “economic surgery” policy introduced four months ago to reduce import subsidies.

Authorities are continuing to allocate foreign currency for essential imports, including medicine, at a fixed rate of 285,000 rials per dollar—far below the open market rate of around 1.5 million rials and the official budget rate of 1.23 million.

This subsidized rate, capped at $3.5 billion, applies to critical imports including wheat, medicine, pharmaceutical ingredients and infant formula. An additional $1 billion withdrawal from the sovereign fund is intended to help sustain the system.

Wheat and infant formula remain among the government’s highest priorities because shortages or price spikes could trigger social unrest.

Rising unemployment

To offset price hikes after January’s subsidy cuts on goods such as meat and cooking oil, the government reintroduced a coupon system. Around 87 million people receive monthly vouchers, initially worth 10 million rials per person.

But their value has eroded rapidly. Monthly inflation reached 7 percent and point-to-point inflation 67 percent, according to the Central Bank of Iran.

Consumers describe day-to-day increases in the price of basic goods and services, leaving many households unable to afford necessities.

At the same time, unemployment is rising sharply.

War-related damage to steel and petrochemical hubs has left large numbers of workers jobless and disrupted downstream industries reliant on their output.

'Hunger riots'

A prolonged internet shutdown—now entering its third month—has compounded the crisis, cutting off income for millions. Tourism has also collapsed, with airlines, hotels and local accommodations nearly inactive after the 12-day war.

Even those who remain employed are watching their purchasing power evaporate.

At a petrochemical terminals company in Bandar Mahshahr, representatives for more than 700 workers say their employer has eliminated overtime, holiday pay and welfare benefits.

In some cases, workers report wages have gone unpaid for months.

Political analyst Shahin Shahid-Saless warned that a naval blockade restricting oil exports and broader trade could accelerate the currency’s collapse.

“The national currency will collapse at an unbelievable speed, and hyperinflation will emerge,” he said. “The country may face … hunger riots whose intensity and violence would be entirely different from [recent] movements.”

A widening split over how to deal with the United States has reached the deepest layers of Iran’s hardline establishment, surfacing in state-linked media and among factions that have long presented a united front under the banner of revolutionary loyalty.

The divide became unusually public this week as several ultraconservative MPs refused to sign a letter backing Iran’s negotiating team. The dispute then spilled into hardline media, triggering an unprecedented public clash between Raja News and the Revolutionary Guards-linked Tasnim News Agency.

The confrontation largely pits supporters of former nuclear negotiator and National Security Council member Saeed Jalili against allies of his longtime rival, parliament speaker Mohammad Bagher Ghalibaf, who recently led Iran’s delegation in talks in Islamabad.

On Monday, Iranian media reported that 27 members of parliament—including seven affiliated with Jalili’s ultraconservative camp—refused to sign a letter backing the negotiating team and Ghalibaf’s leadership in the Islamabad talks.

One of them, Mahmoud Nabavian, who had traveled to Islamabad with the delegation, later claimed that Mojtaba Khamenei’s “red lines” had been violated. He alleged that negotiators had engaged with the United States on nuclear issues against those guidelines.

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The divide became unusually public this week as several ultraconservative MPs refused to sign a letter backing Iran’s negotiating team. The dispute then spilled into hardline media, triggering an unprecedented public clash between Raja News and the Revolutionary Guards-linked Tasnim News Agency.

The confrontation largely pits supporters of former nuclear negotiator and National Security Council member Saeed Jalili against allies of his longtime rival, parliament speaker Mohammad Bagher Ghalibaf, who recently led Iran’s delegation in talks in Islamabad.

On Monday, Iranian media reported that 27 members of parliament—including seven affiliated with Jalili’s ultraconservative camp—refused to sign a letter backing the negotiating team and Ghalibaf’s leadership in the Islamabad talks.

One of them, Mahmoud Nabavian, who had traveled to Islamabad with the delegation, later claimed that Mojtaba Khamenei’s “red lines” had been violated. He alleged that negotiators had engaged with the United States on nuclear issues against those guidelines.

In recent days, hardline lawmakers and commentators have increasingly criticized the negotiating team.

Jalili himself appeared to escalate tensions when he called on Mojtaba Khamenei to clarify publicly whether ongoing actions reflected his directives. In a now-deleted post, he wrote that if no such message was issued, “there is one hundred percent a ‘sedition of officials,’ and all these statements are written by the coup plotter himself.”

The remark was widely seen as aimed at Ghalibaf.

The feud escalated further after a Tasnim editorial said demanding the United States lift all sanctions or agree to a comprehensive ceasefire with Iran’s armed allies in the region amounted to unrealistic expectations like a “magic beanstalk.”

The article also argued that negotiations with the United States should not be seen as a final solution and that “the power of the people in the streets” could serve as Iran’s main leverage.

Raja News published a harsh response.

Tasnim later removed the article, saying it had republished it from another outlet, but responded in an unusually sharp tone, accusing Raja of inciting division and acting against national security.

It said the outlet was “seeking to complete Trump’s project in Iran” and noted that some individuals had recently been arrested over “suspicious movements to undermine sacred unity.”

A Telegram post by Saberin News, a channel linked to security institutions, went further, labeling the Paydari Party as the Kharijites—a historical term for extremist dissenters who opposed and ultimately assassinated Imam Ali, the first Shia imam.

The post accused them of “sowing division on the battlefield” and “playing in favor of Israel and the United States.”

Iran’s state broadcaster (IRIB) has also come under scrutiny for alleged bias. Its deputy for cultural affairs, Vahid Jalili, is Saeed Jalili’s brother.

Moderate outlet Khabar Online reported that by its count, 8 out of 10 of pundits appearing on IRIB during the recent conflict have been conservatives, with 15 percent linked to the ultraconservative Paydari Front.

“The problem is not just the elimination of reformists; the data shows that even moderate conservatives or critical insiders have almost no presence in these programs,” the outlet wrote.

Raja News later said it would avoid prolonging the dispute in public and would instead pursue legal action. But as the stakes rise—whether through renewed talks with Washington or a return to war—it may prove difficult to put the genie back in the bottle.