Iran says harm to economy must be punished

TEHRAN - Iran's Supreme Leader demanded the judiciary punish those "who disrupt economic security" on Wednesday, following protests over the rial's collapse and a tightening of US sanctions pressure that has set the arch-foes further on a course of confrontation.

Resolutely opposed to Iran's nuclear programme and its role in Syria's war, Washington is to reimpose economic penalties on Tehran in coming months after quitting an accord in which sanctions were lifted in return for curbs on its atomic work.

This may cut Iran's hard currency earnings from oil exports, and the prospect has provoked a flight of Iranians' savings from the rial into dollars.

In the latest US push against Tehran, a senior US official said on Tuesday that countries buying oil from Iran should prepare to halt all imports of it starting in November or face punishment.

At Tehran's Grand Bazaar on Wednesday, business was back to normal after a two-day strike had closed most shops. Traders returned to work under a heavy riot police presence, the Fars news agency said, after they had massed outside parliament to complain about the plunge to record lows of Iran's currency on Monday.

Public demonstrations are rare in Iran but in recent months there have been several over the state of the economy.

"The atmosphere for the work, life and livelihood of the people must be secure," Ayatollah Ali Khamenei said in a meeting with judiciary officials, according to his official website.

"And the judiciary must confront those who disrupt economic security."

Following Washington's withdrawal from a 2015 nuclear deal between world powers and Iran, some US sanctions are due to be reimposed in August and some in November.

Import costs rise

This has caused the rial to collapse, threatening business by driving up the cost of imports. The rial traded at 78,500 against the dollar in the unofficial market on Wednesday, according to foreign exchange website Bonbast.com. This compares to around 43,000 at the end of last year.

US Secretary of State Mike Pompeo has warned Iran it would face the "wrath of the entire world" if it pursued nuclear weapons, but added that he hoped it would never be necessary for the United States to take military action against the country.

On Wednesday, Pompeo accused Iran's leaders of wasting the country's resources on its proxies in the Middle East.

"It should surprise no one #IranProtests continue. People are tired of the corruption, injustice & incompetence of their leaders. The world hears their voice," he tweeted.

Reacting to the US announcement on Tuesday, an Iranian oil official said the United States' efforts against Iran's oil industry will fail.

"Iran exports a total amount of 2.5 million barrel per day of crude and condensate and eliminating it easily and in a period of a few months is impossible," the oil official told the semi-official Tasnim news agency.

Trump's attempts to deprive Iran of oil revenues raises the stakes for President Hassan Rouhani, who has attempted to appease anger over his government's handling of the economy.

A ban on imports of over 1,300 products announced by Iran on Monday in order to prepare its economy for looming US sanctions presented a big opportunity for Iranian companies, Rouhani said.

"The government's decision to ban the import of some goods to the country with the goal of protecting Iranian goods is a very big opportunity for domestic producers," he was quoted as saying on state media.

A senior commander of the powerful Revolutionary Guards said all Iranians were obliged to help the government cope with any financial crisis, according to Fars News.

"It is all of our duty to work together to help the respected government and other governmental branches in solving the economic problems," General Yahya Rahim-Safavi, who is also a senior advisor to Iran's Supreme Leader, said on Wednesday.

"We must neutralize the plans of the enemy for an economic war and psychological operations."

Increased distrust

Meanwhile nearly two-thirds of Iran's MPs have written to President Hassan Rouhani demanding he change his economic team to deal with the country's worsening financial woes, state media said Wednesday.

"The poor performance of senior officials in charge of the economy over the past few years has led to the population's increased distrust," wrote 187 of the Iranian parliament's 290 lawmakers, in a letter published by IRNA news agency.

In their letter, the members of parliament urged Rouhani to act "as a matter of urgency", calling on the president to make changes "in the management of the economic team".

The overhaul must bring "dynamism" and an "understanding" of the economic situation, they wrote, before parliament "takes a decision on the matter".

The government's economic team is made up of vice-presidents and ministers, as well as Rouhani's economic advisers and the central bank president.

Lawmakers have the power to dismiss ministers or to declare, through a two-thirds majority vote, the "incapacity" of the president, paving the way for his possible dismissal by Iran's supreme leader.

Rouhani was re-elected in May 2017 on the promise of boosting Iran's economy and implementing social reforms.

He has been fiercely attacked in recent weeks by ultra-conservatives, who have denounced his policy of openness with the West and have accused him of damaging the economy.

On Tuesday, Rouhani called for unity a day after Grand Bazaar vendors went on strike over the collapse of the rial on foreign exchange markets.

Brief scuffles had also broken out on Monday between protesters and police in central Tehran.