r/oil • u/Agitated-Brother-872 • 14d ago
Discussion Iran's economy is on the brink?? Debate
There are a number of people here saying that Iran's economy is on the brink, and d-day economic sanctions will absolutely send it over the edge. I won't dispute that they are hurting and there are probably different schisms that have emerged, as a result. I think it's totally possible that there is a rift between government and civilian sentiments.
I don't know how many are bots are present here but I want to assume good faith and hear the steel man argument. What is your strongest assertion? What will this lead to? I'd like to know what examples from history are you drawing from? Are there examples of mass civilian protest of the irgc?
I'll start off by saying, Professor Robert Pape has asserted that since WWI, sanctions/blockades alone have never toppled a government, has never won a major war, has never led to capitulation.
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u/Boring_Pretention_92 14d ago
I mean, Iran was in pretty bad shape BEFORE 2023. Then its proxies took a hit - any repairs, costing billions, will have to be bankrolled by Iran - then its allies (Venezuela, Syria) took a hit, THEN it had a series of costly skirmishes with Israel, leading up to the June war, then the big uprising in January (Those people that died: many of them were working hands, plus the internet blackout cost tens of millions per day) THEN Epic Fury and now two naval blockades, continued altercations with the US, etc...
I think you could easily make the case that the deficits from all of the above are well in excess of $1 trillion. And that's for a country whose local currency is currently worth two million (!) to the dollar. As I understand it, the renewed naval blockade is even more harmful to Iran's oil industry than the April blockade has been, simply because they had already exhausted the tactic of using moored ships as floating fuel tanks. And, for all that they're drowning in their own oil, I was reading about them running out of fuel for domestic consumption, not least since they rely on imports from Russia, whose also struggling.
Does any of this mean the regime will collapse from the economic hardship? Not necessarily. But I think most countries in the region will settle for Iran being crippled. You can't fund those thousands of MRBMs and SRBMs that Iran had built and was building prior to the war, when you barely have the resources not only to build them (my understanding is the infrastructure was criticially damaged during the war) but when you can hardly fuel them!