Iran’s currency has declined, and many foreign airlines have suspended their flights as they prepare for a retaliatory Israeli attack against the Islamic Republic.
On the open market, the rial fell almost 5 percent to 640,000 dollars on Monday from 610,000 dollars on September 30, the day before Iran launched its ballistic missile attack on Israel. The main index of the Tehran Stock Exchange fell from 2.131mn to 2.007mn, a decline of almost 6 percent, during the same time period.
The two currencies have both continued to decline steadily this week as many are concerned that the threat of war could deepen Iran’s economic crisis and isolation.
Israel is ready to strike back at Iran for its attack this month with scores of missiles, which Tehran claimed was in response to the death of Hassan Nazarallah, leader of Iran-backed Lebanese militant Hizbollah and a senior commander from Iran’s Revolutionary Guards, in air strikes in Beirut. US officials were informed by top Israeli officials that they intend to target military targets.
As airlines cancel flights in anticipation of an Israeli strike, travel chaos has resulted. Ticket prices have risen and travel times have been prolonged due to the rerouting. Flydubai, the only foreign airline operating in Iran following the suspension of flights by Emirates, Qatar Airways, and Turkish Airlines this month.
Many Iranians now feel deeply concerned about the possibility of a war between Iran, and Israel. Israel has promised a “precise” and “deadly” response following an escalation in hostilities after an earlier exchange of gunfire in April.
While regime loyalists claim that the Islamic Republic is not afraid to fight and that it embraces military confrontation with Israel many are concerned that the sanctions-hit country’s economy cannot afford another round of escalation.
“I panic when I hear loud noises and wake up at night believing Israel has attacked,” Maliheh said, a 65 year-old woman from Tehran. This is our daily life, despite all the economic and politic problems we are facing.
Saeed Laylaz is a political economist who said that the government has been managing the supply and demand on the currency market in order to reduce large fluctuations.
He said that there was a “psychological atmosphere” in the country. “But the new turbulences won’t deter the Islamic Republic from pursuing their regional policies or reacting to any Israeli attacks.” Iran’s economy has a long history of navigating through political crises.
Iran Air, the flagship airline of Iran, also canceled its flights to European countries last week after the EU imposed sanction on the carrier over what the EU claimed was a transfer of ballistic rockets to Russia to be used against Ukraine. Iran denies this claim.
One woman said, “It took three days for me to reach Tehran after my Iran Air flight from Frankfurt was abruptly canceled,” at Tehran’s Imam Khomeini International Airport.
A young man described the ordeal he had to endure when travelling from Scotland. He said, “I had to change my route through Georgia and it cost me twice as much as I usually pay.”
Israel has dealt several heavy blows against the so-called “axis of Resistance” of the Iranian regime, an important tool in its foreign policy. Hardliners and reformists both mourned last week’s death of Hamas leader Yahya sinwar in Gaza.
Iran’s Foreign Minister Abbas Araghchi, as tensions grew this month, launched a flurry diplomatic activity. He toured nine countries in the region and met Hamas leaders on Turkish soil. He warned Israel to refrain from any attack on Iran’s energy and nuclear facilities.
Some people in Iran are indifferent to conflict because of their frustration over their leaders’ ideologic-driven domestic and foreign policy. They argue that the devastation caused by an Israeli attack is nothing compared to their current suffering.
I’m 58 and live in a rented flat with my two adult unemployed children. Hassan, the driver, asked: “How can I believe any ideology?” “I have already lost all my foreign clients. The number of foreign flights has decreased. It has been terrible and it will only get worse.”
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