Iran seeks to contain unrest as US pressure deepens economic woes

Iran's leadership is seeking to rally national unity and maintain stability as the country faces mounting US economic pressure, military escalation and growing domestic discontent.

The pressure has intensified since Washington imposed what it described as an "Economic D-Day", introducing its toughest sanctions regime against Tehran in an effort to cut financial lifelines supporting the Iranian government and the Islamic Revolutionary Guard Corps (IRGC), says Al Jazeera.

The economic strain has been compounded by military confrontation. As part of a naval blockade aimed at restricting Iranian crude exports, the United States has blocked Iranian tankers from leaving southern ports, while the US military recently bombed an oil tanker near Kharg Island and attacked shipping in the Strait of Hormuz and targets across southern Iran.

President Masoud Pezeshkian has framed the pressure as part of an effort by Iran's adversaries to destabilise the country from within.

"Through war, blockade and sanctions, the enemies seek to create division, fissures and unrest inside the country," Pezeshkian said during an address to officials.

Currency and fuel pressures

Iran's currency has fallen to an all-time low, trading at more than 2.25 million rials per US dollar following the escalation.

The country is also facing severe energy shortages, with fuel smuggling, damaged or neglected oil and gas infrastructure and the high fuel consumption of domestic vehicles contributing to the problem.

The government is under pressure to address fuel shortages while limiting the impact of higher petrol prices on households and the wider economy.

Pezeshkian has acknowledged the difficulty of imposing further economic pressure on the population.

"People are now on the edge; if I impose another pressure, they may fall off," he said during a televised appearance about domestic petrol prices and inflation.

His administration plans to halve monthly petrol quotas and double the price of one of the three petrol quota tiers. Pezeshkian has avoided broader price increases because they could raise logistics costs and add to inflation, which is already affecting households across the country.

Concern over renewed protests

Iranian authorities are increasingly concerned that economic hardship could trigger protests similar to the large antigovernment fuel demonstrations of 2019 and 2020.

IRGC intelligence has said the United States, Israel and their Western allies are shifting towards encouraging "pressure from within" to foment protests.

Parliament Speaker Mohammad Bagher Ghalibaf has described domestic unrest as a distinct security challenge alongside the country's other areas of confrontation.

"The fourth battlefield is the street – the social field," Ghalibaf said, referring to the threat of unrest alongside military, diplomatic and economic battlefields.

Police Chief Ahmad-Reza Radan has ordered continuous monitoring of potential "pretexts" for protests, including petrol prices, unemployment and livelihoods.

Supreme Leader Mojtaba Khamenei has also called for measures to protect social cohesion.

"I declare decisively that anything harmful to social cohesion is prohibited," he said in a statement featured on public posters and banners.

Crackdown on dissent

The authorities have also warned of tougher action against people considered a threat to national security.

Judiciary Chief Gholam-Hossein Mohseni-Ejei said the judiciary would prosecute individuals who damage national security "more decisively than all previous eras."

The state has also taken action against businesses and individuals accused of supporting dissent. The Supreme Court recently upheld a 12.5-year prison sentence and confiscation of assets worth millions of dollars against businessman Sadegh Saedinia after his hospitality and food brands promoted a strike on Instagram during protests in January.

Iranian officials have described the January protests as a US- and Israeli-orchestrated "coup" involving armed domestic agents.

Since the start of the war with the United States on 28 February, judicial authorities have executed dozens of people, some of whom were accused of involvement in the demonstrations.

Diplomatic opening remains

Despite the escalation, Iranian officials have indicated that a diplomatic route remains possible.

The government has said it is prepared to return to the commitments outlined in a failed June memorandum of understanding signed with Washington, provided the United States reciprocates.

For Iran's leadership, the challenge is to manage the economic consequences of the confrontation while containing domestic discontent and maintaining political stability.