Published: June 07, 2026, 07:33 UTC
Iran is already preparing for the perilous transition from wartime unity to peacetime fracture. After 100 days of war with the United States and Israel, the country faces hyperinflation, a 10 percent economic contraction, rolling blackouts, and a regime debating whether it can survive the peace better than it survived the war.
The Guardian reported Saturday that the Iranian economy is entering what would be peacetime with food inflation at its highest since World War II. According to the Statistical Centre of Iran, annual food inflation hit 130 percent in May. Meat and chicken inflation reached 176 percent. Health experts warn of rising malnutrition, osteoporosis, and stunted growth as Iranian families cut dairy products from their diets.
A former communications minister, Mohammad Javad Azari Jahromi, wrote on his Telegram channel: “Trump and Netanyahu’s next bomb may not be gunpowder; it may be inflation. The battlefield is the people’s table, housing rent. Are you aware of the accumulation of dissatisfaction?”
The blockade’s toll
Much depends on whether Donald Trump truly intends to lift the economic blockade that has suffocated Iran’s economy. But few Iranian economists believe the relief will amount to much more than a small fraction of the estimated $270 billion in losses the war has inflicted on infrastructure, schools, energy networks, steelworks, and housing.
The US naval blockade in the Persian Gulf and Strait of Hormuz has bled Iran of an estimated $6 billion in oil revenues since February, according to US officials. The internet blockade, imposed to prevent coordination of dissent, has put at least 2 million Iranians out of work, according to University of Kurdistan sociology professor Fuad Habibi.
“Economic crises and livelihood dissatisfaction have clearly increased,” Habibi said. “Since we do not have a society in which protests are expressed through official channels such as parties, guilds and unions, you will always be surprised.”
The January precedent
The conditions that led to the bloody prewar protests in January 2026 have not been solved. They have been made worse. The regime responded with unprecedented repression: new espionage laws, asset seizures of dissidents, and a wave of executions. The Islamic National Unity party, a leading reformist group, published an open letter to President Masoud Pezeshkian this week urging him to stop the executions, noting that at least 22 political prisoners were put to death between March 17 and April 27 alone.
The national parliament is still banned from meeting in person. The internet, gradually reopening after months of censorship, has revealed the depth of public anger. One activist, Rahim Ghomeishi, wrote: “We had been thrown out of a broken boat. Fear of bloodthirsty whales, fear of terrible waves had taken over our entire being. Poverty was not supposed to become normal in the country.”
Surviving the peace
President Pezeshkian appears to have been deputed to keep the domestic machinery running while the IRGC and supreme leader manage the war and negotiations. He has repeatedly warned of hard times ahead and the need for social cohesion.
The energy ministry was forced to deny that controlled two-hour blackouts would begin as early as next month, despite damage to infrastructure. Arash Najafi, head of the energy commission of the Iranian chamber of commerce, had warned: “To maintain production, people must prepare themselves for two hours of daily shutdowns.” The government is offering 30 percent price discounts to households that cut energy consumption by 10 percent.
The economist Mousa Ghaninejad identified the deeper problem: “The main issue in the Iranian economy is the dominance of command-based governance over rule-based governance. Decisions are made not based on stable and transparent rules, but rather on short-term expediency and political considerations” — a clear reference to the IRGC’s chokehold over the economy.
No bonanza coming
Albert Baghzian, a professor of economics at the University of Tehran, warned against expecting that sanctions relief will solve everything. “In an economy of the size of Iran’s economy, with this level of efficiency in the policymaking sector, it is wrong to think that the influx of $12 billion or $24 billion will lead to a major opening.”
The IRGC and political leadership showed after the 10-day war in 2025 that they could reorganize for battle. The coming test is whether they can reorganize for peace — by addressing the domestic and international problems that hold the country back. If the blockade continues after the war, if capital, technology, and raw materials do not arrive for reconstruction, then the destruction will not be repaired. It will become permanent. Scarcity, exhaustion, and instability will become the texture of everyday life.