Iran International
An Iranian state-owned bank has frozen accounts belonging to the National Iranian Oil Company over outstanding debt obligations, the IRGC-affiliated Fars news agency reported on Wednesday.
The action by Bank of Industry and Mine (BIM) comes despite domestic statutory provisions extending NIOC’s debt repayment deadlines through the end of the current Iranian fiscal year in March 2027, Fars reported, without giving the size of the debt or saying when the accounts were frozen.
The bank is a government-owned lender that mainly finances industrial and mining projects.
The apparent mismatch between the repayment timetable and the freezing of the accounts was not explained by Fars.
NIOC, overseen by Iran's Ministry of Petroleum, sits at the center of the country's energy industry, managing much of its oil exploration, production and exports and providing a major source of revenue.
Later on Wednesday, an NIOC financial official told the Tasnim news agency that the company had been in a dispute with Iran's tax authorities over electronic reporting requirements.
Morteza Rouhi, a tax official in NIOC's financial management division, said state-budgeted companies such as NIOC hold some information they are not permitted to disclose, including details related to oil exports, while tax rules require companies to register sales and transactions electronically.
“The oil and economy ministers held a meeting, after which the president’s legal office intervened and ordered a halt to enforcement. We now have no concerns about the National Iranian Oil Company’s accounts being frozen,” Rouhi said.
Sanctions and domestic pressure
Fars said the accounts were frozen over debt but also pointed in the same report to financial restrictions previously imposed on NIOC by the US Treasury. The bank itself was sanctioned in 2018.
The reference is notable because Washington's restrictions on NIOC have themselves been tied to the company's relationship with the Revolutionary Guards.
The US Treasury determined in 2012 that NIOC was an agent or affiliate of the Islamic Revolutionary Guard Corps and in 2020 designated the company under counterterrorism authorities over what it said was NIOC's support for the IRGC's Quds Force.
NIOC is nevertheless formally overseen by Iran's Ministry of Petroleum and sits at the heart of the state economy, managing much of the country's oil production and exports.
The account freeze therefore puts a domestic financial restriction on a government-controlled company whose international financial finances have been affected by its links to the IRGC, as described by the US Treasury.
Fault lines in Tehran
The action also comes as the war and negotiations with Washington have made divisions among Iran's centers of power increasingly public.
Those divisions do not fall neatly between the government and the IRGC. President Masoud Pezeshkian and officials involved in diplomacy, including Foreign Minister Abbas Araghchi and Parliament Speaker Mohammad Bagher Ghalibaf, have faced pressure from hardline lawmakers, media and political groups opposed to concessions to Washington.
Ghalibaf, himself a former senior IRGC commander, has faced criticism from ultra-hardliners over his role in negotiations. Lawmakers have also stepped up pressure on Araghchi to disclose details of the US talks, with one senior lawmaker saying this week that parliamentarians were gathering material for a possible impeachment effort against the foreign minister.
The divisions have also surfaced among pro-government supporters mobilized on the streets during the war, a constituency sometimes referred to as the "meydan," or field.
Ghalibaf has emphasized the authorities' role in that mobilization, saying officials called supporters onto the streets after news of former Supreme Leader Ali Khamenei's death because they feared the situation could otherwise take a “different turn”.
Some of those gatherings later became platforms for opposition to negotiations and criticism of Ghalibaf, Araghchi and other officials involved in talks with Washington, turning a show of establishment support into another source of pressure over diplomacy.
Araghchi has suggested that foreign intelligence operations could exploit such internal vulnerabilities.
In a recent interview, he said they could seek not only to gather information but also to influence Iran's decision-making and shape its psychological environment and public perceptions.
The NIOC account freeze has not been linked to those political disputes. But it comes as the strains of war, US sanctions and renewed diplomacy increasingly expose tensions among the government, security establishment and other centers of power within the Islamic Republic.
Average annual inflation has climbed to a record 62%, while year-on-year inflation has surged to 82%, rapidly eroding household purchasing power.
Food prices remain the principal driver of overall inflation, with annual food inflation staying in triple digits for a sixth consecutive month. In July, food inflation reached 134% nationwide and 140% in rural areas. More than two-thirds of the food items monitored by the statistical agency now exceed what economists describe as crisis-level inflation.
Prices have risen sharply across other sectors as well. Household appliances are estimated to cost 114% more than a year ago, while transportation costs have climbed 103%. Economists warn that a possible gasoline price increase could push food inflation even higher by raising distribution and delivery costs.
War or government policy?
Critics of President Masoud Pezeshkian’s government, many of whom also oppose an agreement with the United States, argue that the inflation surge is rooted entirely in domestic economic policy rather than the recent conflict.
Hojjat Abdolmaleki, labor minister under former president Ebrahim Raisi, dismissed any connection between the war and rising prices.
“The war has had no effect whatsoever on inflation. Inflation has risen steadily throughout the Pezeshkian Administration, and the war’s contribution to these price increases is zero,” he said.
“Virtually all of this inflation is the direct result of misguided policies and government incompetence. Even without the war, the situation would have been the same, perhaps even worse.”
Other economists reject that assessment, arguing that both domestic policy and the conflict have driven prices higher.
Mohammad Sadegh-Alhosseini told the Iranian Students News Agency (ISNA) that domestic policies could account for inflation of between 30% and 50%, but that the increase beyond that range was linked to international tensions and the war.
Mojtaba Yousefi, a member of parliament, also said it was inaccurate to claim that the war had no effect on prices. “But it is equally wrong to attribute all inflation to the war,” he said.
Economists also caution that even an agreement between Tehran and Washington, potentially unlocking frozen assets, easing sanctions, increasing oil revenue and reducing inflation expectations, would be unlikely to bring prices down quickly.
They say chronic budget deficits, entrenched corruption and structural inefficiencies are so deeply embedded that reversing them could take years.
Even if the fighting ends, the cost of rebuilding damaged infrastructure and industry would continue to strain public finances. Conservative politician Mohammad-Reza Bahonar recently estimated reconstruction costs at $200 billion.
Purchasing power continues to collapse
The inflation surge has increasingly affected ordinary Iranians. According to a report by the Iranian Labour News Agency (ILNA), during recent months even basic staples such as chicken, eggs and bread have become unaffordable for many working-class households. Bread prices alone have risen by between 100% and 140% on average.
Official data show that prices of at least eight food items have more than doubled over the past year. Cooking oil has risen 261%, while meat prices have increased 145%.
By comparison, ILNA wrote, the minimum wage has increased by only 60%, while salaries for civil servants, pensioners, nurses and teachers have risen by between 20% and 43%, averaging roughly 30%. As a result, many of these households no longer fit the conventional definition of the middle class, the report argued.
Government food vouchers introduced in January have also lost much of their purchasing power, as authorities have left their value unchanged despite soaring food prices.
Ahmad, a retired civil servant in Tehran, said the vouchers initially allowed him to buy around ten food items. "Now I can only afford three or four."
Social media has also reflected the growing financial strain. Users report increasing numbers of people selling, or even renting out, personal belongings such as electronic devices to cover daily expenses.
Journalist Azadeh Mokhtari wrote: "When advertisements for selling hair, or even renting laptops for online classes, become more common, it means the middle class is being worn away, and the lower-income class is being pushed out of the economy."
Misery index reaches new peak
The deteriorating economic environment is also reflected in Iran's misery index, the combined rate of annual inflation and unemployment.
With annual inflation at 62% and unemployment at 9.1% in the quarter ending in June, the misery index climbed to a record 71.1%, up from 64.2% in the previous quarter. The index stood at 56.6% during the same period in 2021.
The economic burden is not evenly distributed across the country. Several provinces have recorded misery index readings above 100%, with Lorestan registering the highest level at 121.5%.
Economists say the figures reflect not only declining purchasing power and weaker job security but also rising uncertainty that makes long-term financial planning increasingly difficult for households.
The report described the trend as the emergence of a "survival economy," in which even the smallest household possessions have become tradable assets as families struggle with soaring inflation and shrinking purchasing power.
Online classified advertisements, according to ILNA, increasingly feature offers to sell used work shoes and clothing, empty perfume bottles and natural hair for extensions, alongside listings advertising the rental of property deeds, salary slips and other financial guarantees.
From laptops to perfume bottles
The agency also highlighted growing demand for laptop rentals, with users seeking temporary access to devices for basic tasks such as typing documents, using Microsoft Office software or attending online classes.
"What may initially appear strange or even humorous actually reflects declining purchasing power, changing consumption patterns and households' efforts to generate cash," ILNA wrote.
The shift, The report said, illustrates how ownership is increasingly giving way to renting, while everyday items are being used until the very end of their economic value.
The findings come as inflation continues to weigh on Iranian households. According to the Statistical Center of Iran, annual inflation reached 66% in the Iranian month ending in late July, while year-on-year inflation stood at 87.9%.
A 'survival economy'
The growing number of advertisements, the report said, reflects a broader transformation in household finances, where assets once considered worthless or purely personal are increasingly being converted into immediate sources of income.
The agency said many sellers now bundle together low-value household items to improve their chances of making a sale, while advertisements offering natural hair have also become more common, with prices ranging from negotiable sums to several million rials depending on length, color and quality.
The report follows other recent signs of mounting financial pressure, including the spread of installment payments for healthcare and pharmaceuticals, as many Iranian families struggle to cover everyday expenses.
The expansion of the market for second-hand goods, rentals and personal assets, ILNA said, reflects a growing effort by households to generate cash in an economy where almost anything can become a source of income.
