War weighs on Iran’s economy as US intensifies sanctions

Iran's economy is suffering due to the ongoing war with the United States, according to Iranian leaders. Supreme Leader Ayatollah Khamenei has urged the government to address the hardship, while President Masoud Pezeshkian reported that foreign trade has declined by 35% due to American sanctions and a blockade of Iranian ports. Despite the war being at the six-month mark and negotiations at an impasse, the U.S. has intensified its efforts to punish Iran financially with what it has called an economic "D-Day."

The Treasury Department has imposed sanctions on various entities and individuals linked to Iran, though it refrained from targeting major trade partners such as China and India. This economic strain is compounded by annual inflation reaching 66%. Qatar, a U.S. ally and neighboring country to Iran, has sought to revive diplomatic efforts to end the conflict and reopen the Strait of Hormuz, a strategic waterway that gives Iran leverage over global energy markets.

However, Iranian officials dispute claims that the strait is open, emphasizing that it remains closed to ships without Iranian permission. Shipping data released recently indicates a significant drop in transit through the strait, with only seven commodity vessels passing through on a given day, down from 17 the day before and below the 10-day average of 15.