Iran is running out of money and can't even pay its troops as U.S. blockade chokes the economy, Central Command says, while domestic unrest grows | Fortune
A naval blockade led by the United States has successfully obstructed at least $25 billion in crude oil exports from Iran, according to a video announcement released Friday by Adm. Brad Cooper, the head of U.S. Central Command. This economic pressure is further compounded by the freezing of nearly $350 million in cryptocurrency assets by the U.S. and its international partners. These measures have triggered a severe financial crisis within the Islamic Republic, leaving the government unable to meet its basic payroll obligations.
Blockade Prevents Billions in Oil Exports
Adm. Cooper stated that the financial strain has forced the Iranian regime to stop paying salaries, benefits, and pensions to employees across multiple critical sectors. Impacted industries include energy, construction, manufacturing, and security. Notably, even the Islamic Revolutionary Guard Corps (IRGC) is reportedly failing to pay its own personnel. This lack of funding has led to a desperate situation where regional militia groups aligned with Tehran are withholding wages from their own fighters to redirect those funds back to the IRGC.
Despite the blockade, oil continues to flow from Iran's neighbors at levels similar to those seen before the conflict, as the U.S. military provides protection for these shipments. However, Iran has responded by increasing its attacks on commercial vessels in the Persian Gulf over the last few weeks. The Iranian currency is currently in a state of free fall as the revenue from oil sales evaporates. While some final shipments of crude that were already at sea before the blockade was reinstated are reaching China, those payments are expected to end by December.
Inflation Erodes Salaries and Pensions
The internal economic situation has reached a point where even Supreme Leader Mojtaba Khamenei has voiced his alarm. Mohsen Rezaei, the highest-ranking security official in Iran, recently characterized the current environment as one of the most challenging periods in the history of the nation. With inflation hovering near 90% and rising every month, the purchasing power of Iranian citizens has been decimated. Many consumers are now forced to use installment plans just to buy basic groceries.
Public dissatisfaction is manifesting in widespread protests and labor shortages. The New York Times reported that retired government workers have taken to the streets to protest unpaid or incomplete pensions. Additionally, many employees in both the public and private sectors are using social media to announce their resignations, citing wages that are no longer sufficient to live on.
Security Forces Face Internal Threats
The inability to fund the military coincides with a period of heightened tension. Iran is currently increasing its aggression in the Strait of Hormuz while simultaneously bracing for a potential new U.S. offensive following the midterm elections. On the domestic front, the regime is struggling to contain separatist insurgencies in the southeastern provinces of Sistan and Baluchestan.
In the last three weeks, at least eight members of Iran's security apparatus have been killed in that region, including a senior IRGC commander, a police officer, and a member of the Basij militia. Shay Khatiri, a senior fellow at the Yorktown Institute, noted that the security forces are being stretched thin as they face a combination of diminishing resources and growing threats from both foreign and domestic sources.
Source: fortune.com · 2026-10-18