Iran’s labor protests grow as workers, retirees demand economic action

A resolution by the Economic Council, published Sunday, instructed the Ministry of Oil to create household gas tariffs designed to discourage overconsumption. The move includes categorizing more households as high-consumption users.

“The Ministry of Oil must ensure these tariffs have evident deterrent effects for excessive and unnecessary consumption,” the resolution read.

The tariff changes come alongside scheduled power outages initiated on November 10 due to insufficient fuel reserves. The government had halted mazut burning at select power plants but now plans to restart its use across industries and provincial power stations, sparking public health and environmental concerns.

Citizens, who already contend with heavily subsidized but rising energy costs, now face worsening air quality as mazut—a fuel laden with sulfur and toxins—fills the gap left by dwindling natural gas supplies.

Iran’s decision to calculate residential gas tariffs comes as part of broader fiscal policies to generate additional revenue. Under the new structure, commercial tariffs will also rise, with calculations based on recent peak rates.

Abbas Kazemi, former CEO of the National Iranian Oil Refining and Distribution Company, blamed mismanagement for the fuel shortages. Speaking to ILNA news agency, Kazemi said that critical diesel reserves were depleted after being sold on the stock market.

“Instead of stockpiling diesel for winter, the Abadan Refinery sold 400 to 500 million liters meant for power plants,” Kazemi said.

This mismanagement, coupled with a 36% decline in mazut and diesel reserves compared to last year, has pushed Iran’s electricity grid to a critical juncture. Reports indicate that natural gas supplies to power plants in November have plummeted by 30% year-on-year, leaving thermal power stations—responsible for 80% of Iran’s electricity generation—dependent on low quality mazut.

Speaking to Khabar Online on Sunday, Hadi Haghshenas, an economic expert and the governor of Gilan Province, said: "The lack of electricity primarily stems from insufficient gas supplies. The shortage of gas, in turn, is a result of inadequate investment in the country. The imbalances in the nation are turning into a tangled web, growing increasingly complex."

The use of mazut exacerbates air pollution. High levels of particulate matter from mazut burning increase the prevalence of respiratory and cardiovascular diseases.

“The government’s reliance on mazut is forcing citizens to endure air pollution on top of power outages,” said Mohammad Jafar Ghaempanah, a senior government official, who also suggested reducing household energy consumption as a solution to outages.

As winter approaches, Iranians face an unprecedented convergence of crises with spiraling utility costs, power shortages, and public health risks in spite of being a nation endowed with vast natural gas reserves.

“Our current systems offer far superior capabilities compared to the S-400,” said Davood Sheikhian, deputy for operations of the IRGC Aerospace Force, in a video interview shared by state-controlled media.

He added that Iran is also actively using the Russian-made S-300 system and sees no need for the S-400.

Despite Sheikhian's assertion that Tehran never requested the S-400, reports in recent years have indicated that Iran sought to acquire advanced military technology from Russia, including Su-35 fighter jets and the S-400 air defense system, which Moscow has yet to deliver.

The S-400 system is widely regarded as one of Russia’s most advanced air defense systems, with capabilities to track and intercept various aerial targets, including ballistic missiles and stealth aircraft.

Multiple reports by Tehran's media outlets often spoke of negotiation to acquire the S-400 and there were even reports as recently as in August that Moscow had delivered the missiles.

Russia completed its delivery of the S-300 air defense missile systems to Iran in 2016, according to its state arms export agency, after years of delays due to international pressure. Moscow initially suspended the contract in 2010 under Western pressure, but President Vladimir Putin lifted the ban in 2016 following an interim agreement with Iran. The decision to proceed with the delivery at the time raised concerns in Israel, as the S-300 systems could significantly bolster Iran's air defense capabilities.

Sheikhian’s comments about Iran still using the S-300 contradict recent reports of Israeli airstrikes in late October that targeted and disabled Tehran's last three S-300 air defense systems, according to US and Israeli officials cited by Western media.

These S-300 systems were reportedly the final units in Tehran's arsenal, following the destruction of another battery in an April attack also attributed to Israel.

“The Iranian nation must equip itself with all the weapons that its terrorist enemies, namely the US and Israel, possess,” said Mahmoud Nabavian, a representative for Tehran in the parliament during Sunday’s parliamentary session.

On Saturday, Ahmad Naderi, another parliamentarian, echoed the sentiments in an interview with local media, saying, “Our adversaries possess extensive and ready-to-deploy arsenals of nuclear warheads, leaving Iran at a significant strategic disadvantage.”

He criticized the economic and strategic costs of Iran’s existing nuclear program, adding that the absence of nuclear deterrence has rendered it ineffective.

The statements align with a broader push by 39 lawmakers urging Iran’s Supreme National Security Council to reassess its current approach.

Iranian officials have long maintained that their nuclear program is peaceful, citing a fatwa from Supreme Leader Ali Khamenei prohibiting weapons of mass destruction. However, Kamal Kharrazi, a senior advisor to Khamenei, recently hinted that the decree could be reconsidered.

Kharrazi also suggested that Iran might soon abandon its self-imposed limit on missile range, signaling a potential shift toward developing intercontinental capabilities. “If the Islamic Republic of Iran faces an existential threat, we may have no choice but to adjust our military doctrine,” he said earlier this month.

Regional tensions underpin the debates. Israel’s intensified military actions, including a recent airstrike on Iran which destroyed swathes of Iran's air defences in addition to damaging a nuclear research facility, have heightened Tehran’s sense of vulnerability. This escalation followed Iran’s October 1 missile attack on Israel, prompting retaliatory strikes by Israel that killed four Iranian soldiers.

Tehran's uranium stockpile, enriched to 60%, could be further refined to weapons-grade 90% within approximately two weeks. Such a doctrinal shift would likely signal Iran's readiness to pursue nuclear weapons if Israeli military actions jeopardize its vital interests.

The denial has widely been interpreted as a reaction to hardline Kayhan newspaper’s Saturday attack on the foreign policy apparatus for the meeting.

In an article titled “Secret Meeting with Trump’s Representative: Naivety or Treason,” Kayhan accused Iran’s reformists and “agents of the West’s war against Iran” of laying the groundwork for negotiations with the United States, which it referred to as the “terrorist regime,” through such actions.

The newspaper is financed by Supreme Leader Ali Khamenei's office and overseen by ultra-hardliner Hossein Shariatmadari, a Khamenei appointee whom reformists consider their sworn enemy. 

“Dear Mr. Araghchi, [the Iranian] people’s stances should be your yardstick not Kayhan newspaper’s headlines,” Mohammad-Ali Abtahi, a former reformist vice president, tweeted Sunday.

Abtahi criticized the foreign policy apparatus for staying silent for nearly three days about the meeting—a topic widely discussed with interest and seen by some as a potential step toward easing US sanctions. He noted that officials only issued a denial after Kayhan launched its attack on the move.

“Stay true to being Pezeshkian’s and the people’s foreign minister,” Abtahi wrote, urging Araghchi not to shape his positions based on reactions from ultra-hardliners. He argued that the public voted for Masoud Pezeshkian, not his ultra-hardliner rival Saeed Jalili.

“There is nothing more pathetic than a government adjusting and announcing its positions, confirmations, and denials based on the threats and attacks of pulp media and pressure groups,” Hossein Selahvarzi, a former president of Iran's Chamber of Commerce, protested in a tweet Sunday.

The report of the rare meeting was welcomed not only by reformist media—one outlet even dubbing it “the Elon channel [for talks]”—but also by some moderate conservatives.

“The meeting could mark the beginning of a new path in our country’s foreign policy,” the conservative Jomhouri Eslami newspaper wrote on Saturday.

In a live interview broadcast on state television Saturday evening, Araghchi denied reports of a meeting between Ambassador Amir-Saeid Iravani and Trump advisor Elon Musk. The meeting was first reported by The New York Times on Thursday and later corroborated, with minor variations, by the Associated Press and CBS News.

The Iranian foreign minister called the report a fabricated scenario possibly aimed at testing Iran's reaction. After the denial, Shariatmadari thanked Araghchi on Sunday, but insisted that the denial of what he called "devastating news" came too late.

Foreign Ministry Spokesman Esmaeil Baghaei had “categorically” denied the meeting in what appeared to be a brief exclusive interview with the official news agency IRNA earlier Saturday.

Neither Musk nor President-elect Donald Trump's team have commented on the meeting. Skeptical critics from across the political spectrum argue, that this is proof the meeting had really taken place and the foreign ministry’s “categorical” denial could not be trusted.

“The public has every right to suspect that the meeting did take place but was intended to remain confidential, and that our Foreign Ministry spokesperson denied it only because the American side complained about the leak,” tweeted Mehdi Ghasemzadeh, a hardliner commentator and social media activist, on Saturday.

He also argued that the delay in refuting the New York Times report had helped establish the “American media’s narrative” on the matter. 

A former official of Mahmoud Ahmadinejad’s government, Mohammad-Javad Mohammadzadeh, also suggested in a tweet that the foreign ministry’s denial of the meeting was false and cited Araghchi’s “correction” of a Pezeshkian remark about Iran's preparedness to reduce tensions with Israel during his UNGA visit in New York in September as another example of false denials of Pezeshkian’s government.

Others have noted that false denials by Iran's foreign policy apparatus are not unprecedented, citing several instances in recent years. These include the denial of Israel’s removal of a massive cache of nuclear documents from a facility near Tehran in 2018, the refutation of reports about secret talks in Oman in 2013 between Supreme Leader Ali Khamenei’s foreign policy adviser Ali-Akbar Velayati and the US, and the denial of the Revolutionary Guards’ active involvement in the Syrian war alongside Bashar al-Assad's forces in 2011.

The head of Iran-Syria chamber of commerce, Saeed Aref announced that Saipa, the sole Iranian automaker active in Syria, has ceased production, and no other Iranian factories in the country have become operational, citing unresolved issues between the two countries.

"Iranian companies are still active in providing infrastructure for Syrian industries, exporting technical and engineering services, and carrying out essential and specialized infrastructure repairs," he added.

The announcement comes as Supreme Leader Ali Khamenei’s special representative, Ali Larijani, visited Damascus and Beirut, signaling ongoing efforts to strengthen Iran’s regional influence. However, Iran’s economic footprint in Syria remains disproportionately small despite its costly military involvement during the civil war.

The story of Saipa’s factory in Syria began during the Mohammad Khatami administration in 2004, with construction initiated as part of an ambitious bilateral project.

By 2007, the Pride model’s production line was inaugurated in Homs in the presence of Syrian President Bashar al-Assad. The project, dubbed Siveco, saw Saipa owning 80% of the company while the Syrian government held a 20% stake.

During Mahmoud Ahmadinejad’s presidency, Saipa’s Syrian operations became emblematic of the Islamic Republic’s broader industrial ambitions abroad, with plans to produce up to 15,000 vehicles annually.

A similar initiative by Iran Khodro aimed to establish a factory in Syria in 2009. Yet, these ventures struggled to achieve success as civil war began in 2011, and repeated attempts to reach profitability largely faltered.

Iran’s economic struggles in Syria are accentuated by its massive financial outlays during the civil war. In 2020, Heshmatollah Falahatpisheh, a former member of Iranian Parliament’s National Security and Foreign Policy Committee, estimated that Iran spent $20 to $30 billion supporting Bashar al-Assad’s regime.

"We may have given $20 to $30 billion to Syria, and we need to get it back. This nation’s money was spent there," he said. Others have put the figure at more than $50 billion.

Despite this significant investment, Iran’s share in Syria’s post-war economy remains minimal. Mohammad Amirzadeh, Vice President of Iran’s Chamber of Commerce, lamented in 2021 that weak economic diplomacy had reduced Iran’s share in the Syrian market to just 3%, compared to Turkey’s dominant 30%.

But the real reasons might be economic, as Syrians prefer to deal with free-market economies with competitive quality and price, rather than Iran's government-controlled and isolated economy.

The shuttering of Saipa’s factory epitomizes the Islamic Republic’s inability to capitalize on its investments in Syria. While Turkey and other players secure substantial shares of the Syrian economy, Iran faces diminishing returns despite its critical role in supporting Assad during the war.