Over the past few months, Iran has faced a sharp drop in economic growth. Iran’s currency, the rial, has collapsed, losing 75 percent of its value. That’s a severe blow in an economy as reliant on imports as Iran. Stores have closed down in Tehran’s Grand Bazaar, in evidence of just how hard the economy is already suffering. And last week, a truckers and teachers strike rocked the cities.
The real torment, however, will hit in November, when the U.S. targets Iran’s oil industry
U.S. Treasury Undersecretary Sigal Mandelker, who is leading the difficult campaign of implementing and applying financial sanctions against Iran, as well as collecting intelligence about its infrastructure companies, investment companies, and banks, is tying up the loose ends in halting financing for terrorism. He said on Oct. 21, 2018: “Our expectation is that because of our sanctions, oil purchases by foreign authorities from Iran will be going significantly down.”
The second part of reinstituting sanctions, which was set in advance for Nov. 4, is designed to be much more severe, and will include the energy sector. Everyone expects to see steep declines, because Iran’s economy is dependent on purchases of oil by Europe, China, and India.
Meanwhile, a key Chinese bank is preparing to halt transactions with Iran ahead of imminent U.S. sanctions against Tehran, according to Reuters.
Kunlun, the largest conduit for money flows between China and Iran, is telling clients that it will stop processing payments from Iran starting Nov. 1, the news service reported.
Likewise, India’s Reliance Industries Ltd., owner of the world’s biggest refining complex, has halted imports of Iranian crude ahead of U.S. sanctions against Tehran’s oil sector, its joint chief financial officer said.
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