Iran’s oil loadings hit zero as rial crashes to record low

Key Points

1. Iran loaded no crude in September, its first zero month since 1979, under an American naval blockade.
2. The rial trades near 2.7m to the dollar, with annual inflation reaching 90% in September.
3. The squeeze has not yet moved Tehran to end a Gulf war now in its eighth month.

The latest:

Iranian crude loadings fell to zero in September for the first time since 1979, as American warships blockade the country’s ports and enforce sanctions at sea, The Economist reported. Central-bank governor Abdolnasser Hemmati answered collapse predictions with a Persian proverb about counting chickens at the end of autumn. Security chief Mohsen Rezaei told colleagues Iran faces one of the hardest periods in its history, according to state media.

Details:

• The currency: The rial trades at roughly 2.7m to the dollar after breaking one record low after another, The Economist reported. It has lost half its value this year and 99% over the past decade. The central bank injected $2bn of foreign currency last month, slowing the slide but not reversing it.
• The prices: Year-on-year inflation reached 90% in September, the highest since the second world war. Food and transport rose by more than 115% and clothing by 97%, while cooking oil, eggs and rice all climbed by more than 200%. Pensioners have protested over eroded allowances.
• The workers: Iran’s nurses’ association says some members would rather quit than work for salaries now worth about $100 a month. The pharmacists’ union said drug prices had risen 150% this year even before the newest round of sanctions took effect.
• The enforcement: Previous sanctions regimes leaked: even in 2020, at the peak of Donald Trump’s maximum-pressure campaign, Iran sold more than 440,000 barrels a day. American forces disabled or sank at least eight Iranian oil tankers last month, according to The Economist.
• The stockpile: Iran kept selling oil to China in September by drawing on seaborne storage, most of it in Asia. Kpler, a data firm, estimates about 10m barrels remain outside the blockade line, down from more than 120m before the war, and expects the supply to run dry within weeks.
• Non-oil trade: China normally buys more than $4bn of Iranian non-oil goods a year. In the eight months to August, the latest figures available, it bought just $746m, down 67% from last year and 74% from 2024, with purchases falling across plastics and pistachios alike.
• The workarounds: Lorries sit in days-long queues at land borders, and Caspian Sea routes to Russia and Central Asia are capped by port and ship capacity. A plan to move oil to China by rail would require 2,800 tank cars to match one large vessel.
• Air links: Washington sanctioned foreign firms that refuel or service Iranian airliners, effective September 23rd. Tehran’s international airport recorded 153 arrivals and departures in the following two weeks, against 989 a year earlier, nearly all to China, Russia or Turkey. The Bourse & Bazaar Foundation estimates 60% of medical imports arrive by air.
• The offer: Foreign Minister Abbas Araghchi held indirect talks with American officials at the UN General Assembly, proposing an accelerated return to June’s memorandum of understanding: Iran would reopen the Strait of Hormuz within seven days, against 30 in the original text, if Washington met conditions. Trump refused.
• The escalation: Iran has increased attacks on commercial shipping in the strait, with at least ten in the past fortnight, and both sides are preparing for another round of all-out war, The Economist reported.

Background:

The memorandum of understanding signed in June was short-lived. It set a 30-day timetable for Iran to reopen the Strait of Hormuz, the clause Araghchi has now proposed compressing to a week.

Between the lines:

Diplomats read Araghchi’s compressed timetable two ways, according to The Economist: as evidence of distress, or as an offer tabled knowing Trump would reject it. One Arab envoy argued the refusal hands Tehran “cover if they decide to escalate.” The uptick in strait attacks sits alongside that reading rather than against it.

What’s next

December is the convergence point: Iran’s final oil payments should come due, Trump will be past the midterms, and Kpler expects floating storage exhausted well before then. Autumn ends December 21st.