The Iranian regime’s aggressive policies have deepened the country’s long-standing economic crisis. As Israel continues to issue threats of retaliation following Iran’s missile strike on October 1, the Iranian economy and market have reacted with a sharp increase in the price of the dollar and gold, further deteriorating the standard of living for the Iranian people.
The value of the dollar has surged to 65,000 tomans, while the price of gold coins has soared to 56 million tomans. Public concern about the future of the economy is palpable. No longer do people require expert analysis to understand the crisis—they feel its effects in their daily lives.
Economic Leadership in Disarray
Amid falling economic indicators and the market instability caused by the ongoing conflict in Gaza, the regime’s economic leadership, including its president Masoud Pezeshkian, appears paralyzed. Warnings from key ministers, including Abdolnaser Hemmati, the Minister of Economy, make it clear: without a shift in foreign policy and the lifting of sanctions, there can be no effective solution. Despite these pleas, the regime’s leadership, spearheaded by Supreme Leader Ali Khamenei, remains steadfast in supporting its proxy wars in hopes of delaying domestic unrest.
The Iranian government’s continued backing of groups like Hezbollah and Hamas has pushed the country to the brink of war—one that no Middle Eastern nation seems eager to engage in. Once again, the regime is sacrificing the nation’s welfare for its ideological ambitions, reminiscent of the devastation wrought by Ruhollah Khomeini’s eight-year war with Iraq in the 1980s.
Growing Diplomatic Isolation
The regime’s unyielding stance has not only heightened tensions but also deepened Iran’s diplomatic isolation. Calls from within the regime to reassess its confrontational approach have been largely ignored by Khamenei and the Islamic Revolutionary Guard Corps (IRGC).
In an attempt to avert a potential Israeli military strike, Abbas Araghchi has embarked on a series of diplomatic visits to Bahrain and Kuwait. However, these trips have yielded little success. In fact, Iran’s threats towards nations that cooperate with Israel or the U.S. have only driven them closer to those very allies. Bahrain and the UAE, once targets of threats from Iran’s Quds Force, have now formalized agreements to normalize relations with Israel, solidifying their cooperation.
Araghchi’s strategy of intimidation is backfiring. The Arab nations feel more threatened by Iran than by Israel, and rather than managing the crisis, Iran is unintentionally prompting the formation of regional coalitions against it. This diplomatic failure is compounded on the international stage, with countries like China, Russia, and members of the European Union taking stances against Iran’s territorial claims, as exemplified by the recent EU position regarding three disputed islands.
A War Iran Cannot Afford
The regime is acutely aware that a direct war could spell the end of its rule. The purpose of Araghchi’s regional visits is to discourage cooperation with Israel, but history shows that such threats tend to exacerbate tensions rather than alleviate them. The U.S. Fifth Fleet’s presence in Bahrain highlights the fear that regional nations have of the IRGC’s ambitions, fearing Iran more than Israel should war escalate.
The regime’s fear is mirrored in its state-controlled media. On October 21, Ham Mihan, a government-run daily, acknowledged: “War is poison, and history shows us this. War wounds the society, and if the country engages in a useless war, this wound will only deepen.” Similarly, the newspaper Shargh urged for greater diplomatic engagement, stating: “These days, the country’s diplomatic capacity should not be limited to the movements of the foreign minister. Various delegations must represent the country’s unified and coherent peace-seeking policies through constructive initiatives and diplomacy. A great evil has engulfed the region, and the only wise response is bold diplomatic engagement.”
A Collapsing Strategy
What the Iranian regime once called “strategic depth” is rapidly unraveling, with some elements of the strategy nearing the point of irreversibility. Ali Larijani, a regime insider, recently admitted that the current crisis in the Middle East extends beyond the extremism of Israeli Prime Minister Benjamin Netanyahu, asserting that it stems from a Western-led strategy, driven by the U.S., to bring about strategic changes in the region.
The truth is, the survival of the Iranian regime has long been maintained through a combination of brutal repression and an aggressive foreign policy that fuels terrorism and wars. From the Iran-Iraq War to proxy conflicts in Syria, Iraq, Yemen, and Lebanon, the regime has thrived on external conflicts. However, the era of international appeasement that allowed these wars to continue seems to be coming to an end.
Iran regime’s economic collapse, combined with its president’s hollow promises of reform, only adds to the evidence that the regime’s time is running out. Every passing moment seems to edge the country closer to a transformative change.
Source » irannewsupdate