Hormuz will remain under Iran’s control despite Trump threat, official says

Authorities in Kerman announced Thursday that gasoline consumed beyond the existing monthly quota would be sold at 872,000 rials per liter, roughly 17 times the current non-quota price. The measure was halted within hours, fueling speculation that it had been intended as a test for broader changes.

Under the current system, private-car owners receive 60 liters a month at 15,000 rials per liter and another 50 liters at 30,000 rials. Once that allocation is exhausted, gasoline costs 50,000 rials per liter.

The last nationwide gasoline price increase, imposed without warning in November 2019, triggered widespread protests and a deadly crackdown.

After the Kerman scheme was withdrawn, Esmail Saghab-Esfahani, vice president and head of the Organization for Optimization and Strategic Energy Management, appeared on state television to assure citizens that the government had no plan to increase gasoline prices.

Fars news agency, which is affiliated with the Revolutionary Guards, cited a government source Friday as saying an increase had been ruled out for now.

Mohammad-Saeed Ahadian, an adviser to parliament speaker Mohammad-Bagher Ghalibaf, said the heads of the three branches of government had decided against an increase and were considering alternatives.

A widening gasoline deficit

The retreat does little to resolve the problem that prompted the debate: Iran is increasingly consuming more gasoline than it produces.

Saghab-Esfahani said gasoline consumption had reached around 135 million liters a day, compared with domestic production of approximately 121 million liters. The daily shortfall must be covered through imports or strategic reserves.

Saghab-Esfahani also said the recent war had damaged some gasoline production capacity and made imports through southern Iran more difficult. He warned that the gap between production and consumption could reach 70 million liters a day within three years.

Increasing production enough to address the problem would require between $13 billion and $30 billion in investment, he said, money the government cannot afford.

Signs of tightening supply have already emerged, with images circulating on social media in recent days showing long lines of vehicles at fuel stations.

Searching for an alternative

With economic growth below zero and access to foreign currency under pressure, the government faces a choice between raising prices and fundamentally changing how gasoline subsidies are distributed.

One alternative gaining support would shift subsidized gasoline quotas from vehicles to individuals, an idea long promoted by hardliners and associated with former presidential candidate Saeed Jalili.

A version of the scheme was briefly tested on Kish Island under President Ebrahim Raisi before being abandoned.

Supporters argue that the current system disproportionately benefits wealthier households with multiple cars, while more than 40% of Iranian households without private vehicles receive no direct benefit.

Under the proposed model, individuals would instead receive gasoline allocations linked to their national ID or bank accounts and could use or sell them.

Economist Sadegh al-Hosseini, a prominent supporter of the proposal, argued that control over the subsidy should effectively be transferred from the state to citizens.

“Gasoline quotas should be given to people for free based on production, and people themselves should determine the price by trading their quotas,” he wrote on X.

Divisions over reform

The abrupt launch and cancellation of the Kerman scheme has exposed wider divisions within Iran’s political establishment over how to address the fuel problem.

Saghab-Esfahani supports linking gasoline quotas to national ID numbers rather than simply raising prices. His intervention drew criticism from reformist figures who warned of the political risks surrounding any changes to gasoline policy.

Abdollah Ramezanzadeh, spokesman for former President Mohammad Khatami’s government, criticized the handling of the issue in a post addressed to Pezeshkian.

“Entrusting the determination of energy prices—the most political and perhaps the most security-sensitive economic issue in the country—to someone with minimal political and security experience and no experience in crisis management has caused the current confusion over gasoline prices,” he wrote.

“The society is agitated and you have no room for mistakes.”

Ali Gholhaki, a political activist close to Ghalibaf, also pointed to resistance elsewhere in the establishment.

“Using pricing tools under the current circumstances to control fuel consumption is highly sensitive, and some important institutions in the country are also opposed to it,” he wrote.

The Kerman reversal leaves the underlying problem untouched. Iran has a widening gasoline deficit, but the most obvious corrective tool—higher prices—remains perilous under the long shadow of the 2019 upheaval.

The resignation of Mohammad Bagher Zolghadr, the former deputy commander-in-chief of the Islamic Revolutionary Guard Corps (IRGC), from the SNSC positions his tenure as secretary as the shortest in the history of the Islamic Republic.

Zolghadr was demoted, becoming a political advisor to the supreme leader. Rezaei's appointment demonstrates both the militarization and fragmentation of the Islamic Republic’s elite.

The careers of Rezaei and Zolghadr have multiple parallels. Zolghadr served under Rezaei when he was commander-in-chief of the IRGC. Zolghadr was Rezaei’s chief of the IRGC’s joint staff.

Both men later became secretary of the Expediency Council, which advises the supreme leader and arbitrates disputes between parliament and the Guardian Council, after their long tenures in the IRGC’s top brass. The Expediency Council has traditionally been used by Iran’s supreme leaders as a landing spot for the old guard after service in more consequential positions.

The return of these figures to Iran’s top ranks reflects the hollowing out of the Islamic Republic’s military leadership following US and Israeli airstrikes in 2025 and 2026.

This is not Rezaei’s first stint on the SNSC. As commander-in-chief of the IRGC, he served as an SNSC member. But the last time he was officially part of its deliberations was in 1997.

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In becoming secretary of the SNSC, he is the first former IRGC commander-in-chief to serve as secretary. He joins Ahmad Vahidi, the current IRGC chief, who was Quds Force commander under Rezaei’s tenure at the helm of the Guards, who holds a seat on the SNSC.

Rezaei also has a long history with another SNSC member Speaker of Parliament Mohammad Bagher Ghalibaf, who rose through the ranks of the IRGC—as deputy commander of the fearsome Basij and commander of the Khatam al-Anbiya Construction Headquarters—under Rezaei’s leadership. In 1997, when Rezaei departed from the IRGC’s top position, Ghalibaf signed a letter to Rezaei praising him as a “mentor.”

Both Ghalibaf and Rezaei have also been political rivals, unsuccessfully running against each other as candidates for president, for example in 2013. With a supreme leader who has largely been inaccessible and invisible to most in Iran, this sets-up the prospect of clashes within the SNSC, especially as both men have seen themselves as destined for higher office.

Like Zolghadr, Rezaei is also a hardline actor. But Rezaei has exhibited more political competitiveness than his predecessor, having run for office whereas Zolghadr spent most of his career embedded in military and security institutions.

Ghalibaf, however, could be bolstered on the SNSC with the appointment of Ali Abdollahi as chief of staff of Iran’s Armed Forces. Abdollahi served as a longtime deputy of Ghalibaf, when Ghalibaf headed the IRGC’s Air Force and Iran’s Police. Therefore, while Rezaei’s appointment can be seen as a check on Ghalibaf, the latter is not necessarily losing his influence.

Rezaei’s appointment as SNSC secretary is also likely a blow to President Masoud Pezeshkian. Traditionally, despite presidential decrees appointing the SNSC secretary, in practice, the supreme leader decides the fate of the position.

Given Rezaei’s being a longtime fixture in conservative politics in Iran, it can be safely assumed that he was not the reformist Pezeshkian’s first choice for the position. These dynamics further marginalize Pezeshkian and his Foreign Minister Abbas Araghchi. Just days ago, Iranian media reported that Pezeshkian had refused Zolghadr’s resignation as SNSC secretary.

Rezaei’s views may also lead to disagreements with Pezeshkian’s camp, which is more focused on returning to the MOU than dragging negotiations out to build deterrence and achieve a better deal.

In a 2015 state television appearance, Rezaei proclaimed that “we’ll take 1,000 Americans hostage. America will have to pay several billions to get every single one freed. This is how we can solve our economic problems.”

Rezaei’s ascension continues the trend of the SNSC being populated by men steeped in asymmetric tactics against the United States, like terrorism. Zolghadr previously commanded the IRGC’s Ramadan Headquarters which later morphed into the Quds Force.

Rezaei oversaw a particularly active period of IRGC terror plots when he was leading the IRGC—for example the bombings of the Israeli embassy in Argentina in 1992, a Jewish community center in Buenos Aires in 1994, and Khobar Towers in Saudi Arabia which killed 19 American servicemembers in 1996.

INTERPOL issued a Red Notice for Rezaei at Argentina’s request over his alleged involvement in the 1994 AMIA bombing.

Vahidi also participated in the deliberations which led to these attacks and was likewise the suject of an INTERPOL Red Notice. Thus, Iran’s SNSC will now feature two men who are the subject of an INTERPOL Red Notice.

Before, especially under Ali Khamenei’s tenure, softer faces more palatable to the international community served as secretary. Now, the Islamic Republic is broadcasting the rogue nature of the regime—a signal of its overconfidence, which is dangerous.

This raises questions over Iran’s future trajectory with respect to developing nuclear weapons—especially as it’s using the tussle over the Strait of Hormuz as a shield from having to make concessions on its nuclear program.

When he was commander-in-chief of the IRGC, Rezaei was quoted in a 1988 assessment sent to Akbar Hashemi Rafsanjani and later relayed to then-Supreme Leader Ruhollah Khomeini as suggesting that nuclear weapons, among other arms, would be needed if Khomeini chose to continue the Iran-Iraq War, which was depleting the Iranian state.

He did recognize the limits of the Islamic Republic’s power at the time—reportedly telling Khomeini that “there are no victories forthcoming in the next five years” without such weaponry. Although, for now, Rezaei appears content with leveraging the Strait of Hormuz, dubbing Iran’s control over it “more important than dozens of nuclear bombs.”

In the end, Rezaei’s ascension may lead to growing disagreements within the Islamic Republic’s establishment. It also reflects the continued domination—which started before the war—of the IRGC in decision-making.

Rezaei’s predecessors as secretary of the pre-war SNSC, include Ali Shamkhani, who headed the IRGC’s Navy, and Ali Akbar Ahmadian, a longtime IRGC commander himself. Rezaei being elevated at this time is telling given his role in past crises during wartime.

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The debate comes amid speculation that the 60-day arrangement agreed with the United States could be extended by another 30 to 60 days, while Oman continues efforts to broker a temporary reopening of the waterway.

An ILNA report published less than a week before the deadline cited diplomatic sources as saying the atmosphere surrounding the talks had become more positive, though no final agreement had been reached.

The proposed arrangement would not constitute a broader political settlement, but a temporary de-escalation mechanism allowing commercial shipping to resume under monitored conditions.

One source described it as a “technical and security understanding,” with shipping lanes potentially restored in phases.

A ‘golden opportunity’

The possibility of even a temporary reopening has prompted debate in Tehran over how Iran should use what some commentators describe as a “60-day golden opportunity.”

Writing in the moderate Etemad newspaper, Hossein Salahvarzi argued that any easing of tensions would provide a narrow but valuable chance to stabilize trade after months of disruption.

Political de-escalation alone, he warned, would not restore normal commerce. Ships must be willing to enter the region, insurers must accept the risks, freight rates must fall and ports must be able to handle incoming cargo.

Salahvarzi urged authorities to prioritize imports of medicine, grain, livestock feed, critical spare parts and industrial inputs, warning that without clear planning, essential goods could remain stuck in bureaucratic queues until the window closes.

The argument reflects a wider sense of urgency in Iranian coverage, with any reopening increasingly portrayed as a temporary opportunity rather than the beginning of a durable return to normal trade.

ILNA similarly noted that even a short period of stability could reduce freight and insurance costs and ease pressure on essential imports.

Hardliners resist reopening

But the prospect of reopening Hormuz continues to face strong political resistance in Tehran.

Hardline lawmakers on Thursday dismissed the chances of arrangements negotiated with Omani and Pakistani intermediaries succeeding and insisted that the strait should remain closed.

Foreign Ministry officials have also publicly expressed doubts over whether the mediation will produce an agreement.

The competing positions expose a broader disagreement over how Iran should use its remaining leverage over Hormuz: whether to exploit a temporary opening to relieve pressure on its economy or preserve restrictions on shipping as a bargaining tool in negotiations with Washington.

ILNA said Oman had been mediating intensively on a temporary arrangement, while Persian Gulf Arab states, China and Pakistan were also pushing for de-escalation because of the disruption to regional trade.

“No country in the region benefits from a closed Hormuz,” the agency quoted a diplomatic source as saying.

Any agreement would nevertheless remain conditional and reversible, with deep mistrust between Tehran and Washington leaving it vulnerable to another military incident.

For those urging Tehran to seize the opportunity, that uncertainty is precisely the point. A temporary reopening would offer Iran a chance to replenish essential supplies and ease pressure on trade, but with little confidence that calmer conditions in the Persian Gulf will last.

The setting was routine government business: a signing ceremony between two ministries, with footage showing Araghchi alongside Health Minister Mohammad-Reza Zafarghandi. The headline strap announced an agreement between the ministries of health and, in Persian, khavarejeh, Kharijite affairs, instead of kharejeh, foreign affairs. The difference is a single letter vav. A screenshot was circulating within minutes.

Within hours, the strap was a national argument. "Abbas isn't the foreign minister anymore. He's the minister of the Kharijites now," one widely shared post said of the man leading Iran's talks with Washington.

Another user drew the lineage: "Zarif was America's foreign minister. This one turned out to be the Kharijites'." Mohammad Javad Zarif, the architect of the 2015 nuclear deal, spent years being mocked with that title by the broadcaster's favorite guests; to many, the strap was the same insult upgraded, from serving the enemy to heresy.

The reformist daily Etemad asked the question on everyone's screen: "Mistake or mischief?" One viral post refused the innocent reading outright: "With this budget, this many staff, editors, broadcast supervisors and layer after layer of managers, you don't get to say 'it was a typo.'" The post tagged Peyman Jebelli, the broadcaster's hardline chief.

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The deadliest word in the lexicon

The name Kharijites means "those who went out," and the story behind it is Islam's first civil war, remembered as the First Fitna. In 657 AD, at the Battle of Siffin, followers of Imam Ali, the first imam of Shia Islam, pressed him to accept arbitration with his rival Muawiya rather than fight on. When the arbitration went badly, the same men turned on Ali for accepting it, declared that "judgment belongs to God alone," walked out of his camp and made war on him. Ali crushed them at Nahrawan; three years later, a Kharijite assassin's poisoned blade killed him at prayer.

In the Islamic Republic's political language, no insult reaches deeper. "Kharijite" means the traitor within, the pious-faced insider who deserts the rightful leader, the author of fitna, the sedition that splits the faithful.

The late supreme leader Ali Khamenei's own commemorations dwelt on Nahrawan as the hardest of Ali's wars, fought against old companions whose foreheads were calloused from prayer, and his loyalists spent the years after the 2009 protests hanging the word on the opposition.

One user reached for exactly that memory this week, asking a government supporter: "So does your definition cover 2005 and 2009 as well?"

The alibi written into the alphabet

The typo has a linguistically respectable defense, which is part of what makes the episode so perfectly Iranian. Persian preserves a silent vav in a handful of ancient words, a fossil of pronunciation lost a thousand years ago: "sister" is written khvahar but said khahar. A typist's hand trained on those spellings could, in theory, plant the ghost letter in kharejeh on autopilot.

The defenders made that case. "It's a typo, not sabotage. Stop making a mountain out of a molehill," one wrote. Another blamed simple ignorance, at the establishment's expense: "Pure illiteracy at the mullahs' broadcaster. They figured if 'sister' takes the silent vav, 'foreign' must take one too."

The skeptics' answer was the broadcaster's record, which is where the story stops being about spelling.

A seminar, then a knife fight

What happened next may be the most Iranian part of all: the country fell into a theological flame war over the year 657, conducted in quote-tweets, as a proxy for a live question of war and peace.

One camp insisted the label fits the diplomats. "The Kharijites were the negotiation camp. That's the historical record," one post read. Another cast Araghchi in an even older role: "He's standing right where Amr ibn al-As stood, and his caliph is Muawiya," a reference to the silver-tongued arbitrator who outfoxed Ali's side at the table.

The rival camp threw the word back across the aisle. "The Kharijites were the ones pushing the imam into talks with the devil, and when it all went wrong, they blamed the imam," one wrote, a reading with a sharp contemporary edge, since hardline media have spent recent weeks portraying Supreme Leader Mojtaba Khamenei as having opposed the negotiating process that produced the Islamabad agreement.

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Another user completed the thought: "The Kharijites were inside Ali's own government. They kept pressuring him to negotiate, and when the whole thing blew up, they said: we had nothing to do with it."

Others turned the word on the broadcaster's own patrons: "If anyone here fits the Kharijites, it's Jalili and his gang. Extremism is all they've got." A government supporter fired back: "If only you people read some history. The Kharijites were the ones with no seat at the table, endlessly kicking at the government of the day to get one. Exactly like you."

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And beneath the seminar, a threat. One account declared "the Kharijites' coup is near," amplifying a post that urged toppling President Masoud Pezeshkian's government before, it said, the government topples the system.

The broadcaster with a record

The reason so few Iranians extend the benefit of the doubt is that the strap did not appear on a neutral screen.

The Islamic Republic of Iran Broadcasting is run by Jebelli and his cultural deputy Vahid Jalili, the brother of Saeed Jalili, the hardline politician who styles his circle a shadow government, and it has spent months in open warfare with the state's own diplomats.

In recent weeks alone, the broadcaster censored Pezeshkian's disclosure that the late supreme leader had privately ordered officials to negotiate with Washington while publicly ruling talks out; cut short a live interview with parliament speaker and chief negotiator Mohammad Bagher Ghalibaf; ignored a formal order from its own supervisory board to stop censoring senior officials; and answered a complaint from Araghchi with a sneer that it could not give him "24/7 coverage."

The timing gives the letter a forward edge. Jebelli's five-year term expires within weeks, and whether the new supreme leader reappoints the current management has become an early test of the postwar balance between the war camp and the talks camp.

A one-letter insult to the chief diplomat, aired on Jebelli's channels while his renewal hangs in the balance, is either spectacular carelessness or a message about who does not fear the outcome.

One establishment, two masks

A caution belongs here, and some Iranians supplied it themselves. The fight between the broadcaster and the diplomats is real enough to produce casualties, but the moderate-versus-hardliner frame is also the Islamic Republic's most exportable fiction; every actor in this drama supports the system, and the menace of one camp has always been useful to the bargaining of the other.

As one user put it: "It's an open division of labor. America and Israel attack from the outside, the Ahmadinejad crowd and the shadow government undermine from the inside."

A typo that cannot be proven deliberate is the perfect weapon for a factional war that cannot be proven real.

In Persian, the silent vav is written but never pronounced. On Iranian state television, it was the only letter that spoke.

The growing criticism comes as the national average gasoline price has again climbed above $4 a gallon and Democrats show signs of eroding what has traditionally been a Republican advantage with voters on the economy. Gas prices have risen by more than 25% since the Iran war began in February.

Rep. Nikki Budzinski of Illinois pointed Thursday to the latest increase in gasoline prices, saying the national average had reached a record for this point in the year.

“The national gas average just hit a historic high for this time of year—more than $4 a gallon,” she wrote on X. “Families in Central Illinois are paying the price of the war in Iran every single time they pull up to the pump.”

Rep. Andrea Salinas of Oregon said American farmers spent $1.4 billion more on diesel during the spring planting season than a year earlier, blaming the increase on the conflict.

“With Trump’s ILLEGAL war pushing fuel prices higher and higher, growers are the ones paying the price,” she wrote.

The attacks come as polling suggests the economy is becoming an increasingly difficult issue for Trump and Republicans three months before the November 3 midterms.

A Reuters/Ipsos poll released this month found 37% of registered voters preferred Democrats’ approach to the economy, compared with 36% who favored Republicans—the first Democratic advantage on the issue in roughly a decade.

A separate Washington Post/Ipsos poll last month found the economy and high prices were the most commonly cited factors in voters’ midterm choices, mentioned by 54% of registered voters. Only 33% approved of Trump’s handling of the economy, against 65% who disapproved.

Rep. Jim McGovern of Massachusetts sought to connect the war with Trump’s broader economic agenda, including tariffs and tax policy.

“Trump promised to lower prices on day one,” McGovern wrote. “Instead, his billionaires-first economic policies, stupid tariffs & illegal war with Iran are pushing prices to record highs.”

“His policy choices are making your life more expensive while the ultra rich do better than ever before,” he added.

Inflation eased slightly in July but remained above levels seen before the Iran war, while consumer prices have now risen faster than wages for four consecutive months.

Sen. Bernie Sanders sharpened the argument by contrasting federal spending on the war and tax cuts with the cost pressures facing households.

“$900 million for White House vanity projects? Approved. $1 trillion tax cut for the 1%? Approved. $1 trillion for war with Iran? Approved,” Sanders wrote.

“Lower grocery, housing or gas prices? Sorry, you're on your own. Money for billionaires. Money for war. Nothing for working people.”

The growing Democratic focus on gasoline, groceries and the Iran war suggests the party sees an opportunity to turn an issue that helped return Trump to the White House in 2024 against Republicans in November.