Pezeshkian admits hardship as new sanctions approach
Iranian President Masoud Pezeshkian acknowledged on Sunday that the country's citizens face "many problems" as the United States prepares to unveil a new round of sanctions. In a speech broadcast on state television, Pezeshkian said, "I understand we have many problems in society right now. We are trying to prevent these as much as we can." His comments come nearly six months after the start of the war between Iran and the US, and after Washington vowed last week to bring about the "collapse" of the Iranian regime through its newly announced sanctions campaign.
Pezeshkian attributed the situation directly to US President Donald Trump, saying Iran was now "in a full-scale economic, military and security war" because of him. "He says he is imposing the most crushing and terrifying sanctions on Iran," Pezeshkian said.
Economic pressure and its toll
The new sanctions are expected to be detailed at a news conference on Monday, with US Treasury Secretary Scott Bessent promising "the toughest sanctions in history". Bessent has said the measures will "squash" the economy of the "murderous regime" and curtail Iran's ability to "project power through their proxies".
Iranians are already feeling the strain. Videos on social media last week showed empty markets in Tehran and Karaj, with sellers complaining that fresh produce was not being bought. A Tehran resident and a business owner told CNN that economic pressures have become "untenable". Nima, a 36-year-old resident, said some "important things needed we can't even get, like certain medications". A small shop owner, speaking anonymously, said he was barely making ends meet and had to raise prices on even Iranian-made products.
Experts say ordinary Iranians will bear the brunt of the new sanctions. Umud Shokri, a sanctions expert, said further sanctions would weaken the rial, increase inflation, raise the cost of imported goods, and reduce household purchasing power. He also noted that "politically connected" institutions are partially insulated, as they continue to profit from smuggling and currency manipulation.
Historical context: protests and crackdowns
The Iranian government has faced several waves of mass protest in recent years, often triggered by economic hardships such as inflation and exchange rate swings. At the end of December last year, a protest movement initially sparked by the rising cost of living turned into mass demonstrations denouncing those in power. Iranian authorities reported more than 3,000 deaths during the unrest and accused the United States and Israel of orchestrating the violence. Foreign-based NGOs, however, said officials had launched an indiscriminate crackdown that left thousands dead.
Iran's defiance and sanction-evasion tactics
Despite the pressure, Iran appears determined to resist. Pezeshkian said his government was striving "to overcome inflation, livelihood problems, unemployment, and to secure the future of the people, so that they can live with dignity and pride". Iran also warned that any country participating in the US's "economic war" would be considered "an enemy".
Experts note that Iran has developed a decentralized network of front companies, brokers, and exchange houses to evade sanctions. This includes a shadow tanker fleet using ship-to-ship transfers, altered tracking data, and false documentation. In 2024, $9 billion of Iranian shadow banking activity occurred through US correspondent accounts, according to the US Financial Crimes Enforcement Network. Shell companies in oil, shipping, and investment facilitate transactions through networks spanning the UAE, Hong Kong, and Singapore, per the Treasury Department. Payments are often made in Chinese yuan, barter arrangements, or outside the dollar-based banking system.
But experts say the US would need to target major Chinese buyers of Iranian oil, independent refineries, and banks processing Iranian revenue to truly choke off Tehran's revenue, risking retaliation from Beijing. Shokri suggested sanctioning tanker managers, insurers, ports, and ship-to-ship transfer providers, and adding tech restrictions.
Questioning the strategy
Some analysts question whether sanctions alone will achieve Washington's goals. Dina Esfandiary of Bloomberg Economics said, "None of the measures that President Trump is contemplating are going to make Iran capitulate." She argued that what is required is "diplomacy and carrots" with Iran, which "of course is not at all being contemplated".
The human cost is already visible. Neda, a 34-year-old Tehran resident with kidney disease, told CNN she is forced to buy only half of her monthly medication dose, and that dialysis patients are not showing up for treatment.
As the US prepares to reveal the full details of its sanctions, Iranians continue to endure the effects of a prolonged conflict and economic isolation. The path forward remains uncertain, with both sides showing little sign of backing down.