Despite Sanctions Relief, Iran’s Prospects Look Bleak

The international community has just lifted sanctions on Iran in exchange for major nuclear concessions under the deal signed last summer. But fresh lows in oil prices and poor economic performance in Iran mean that Iran will not benefit economically in the ways that critics fear or deal supporters hope.

The architects of the nuclear deal with Iran lauded 'Implementation Day,' on which the sanctions were relieved, as a watershed moment for Iran. Overnight, the United States and the European Union rolled back restrictions on Iran’s international banking activities, oil and refined product sales, and its auto, ports, insurance, shipping and airline sectors. Iran is now allowed back into elite economic circles after decades of international exclusion.

But this could hardly come during worse economic circumstances for Iran. After losing two-thirds of their value in the last eighteen months, oil prices just dipped to eleven-year lows below $30 per barrel. Analysts expect low prices for a long time, which will make it hard for resource-dependent Iran to rake in receipts. Now that sanctions have dropped, Iran plans to expand oil production by an additional 500,000 barrels per day immediately—and expand by up to 1 million barrels per day within a year, adding to a market currently awash in 1.5 million barrels per day of excess oil.

But Iran’s formidable oil supply competitors, Saudi Arabia and Russia, are not interested in making room for Iran in the market. Saudi Arabia in particular has been pumping at record high levels expressly for the purpose of pushing other producers out of the market. Moreover, political hostilities between Iran and Saudi Arabia, leading OPEC producers, make it impossible for the cartel to contemplate cooperation to increase prices and profits.

The poor economic conditions in Iran are another strike against the country. Transparency International ranks Iran 136 out of 175 in its corruption index, and Iran tops the Basel Institute of Governance list of countries with money laundering and terrorist financing risk. Additionally, the World Bank puts Iran at 118 out of 189 in its annual ‘Ease of Doing Business’ report.

As if this dismal score card was not enough, the IMF offers a grim outlook for Iran’s economy. Last month, it forecast GDP growth for 2015/2016 around zero, an increase in unemployment by about 1.5%, and a 10% drop in imports. The IMF has also called attention to troubling public debt and a banking system in disarray.

The slew of risks associated with doing business with Iran will keep international banks on the sidelines. Significantly, many of the well-capitalized, sophisticated European banks have been collectively fined billions of dollars for U.S. sanctions busting and are barred from going back to Iran. Part of the settlement these banks made with the U.S. Department of Justice involved a commitment not to expand activities with the rogue state.

What is the Exchange Rate for the Iranian Rial to the US Dollar?

What Is The Iranian Rials Exchange Rate?

The official exchange rate of the Iranian Rial to the US Dollar is 0.000033. What that means is that 1 Iranian Rial is worth 0.000033 of a single US Dollar.

With the Iranian Rial most buyers are probably used to hearing the rate quoted in price per million. At the offical exchange rate of 0.000033, a million Iranian Rials would cost a buyer $33.13.

With that said, the current going price by most currency brokers and dealers as well as on eBay and other sites is anywhere from $120 to $300 per million, quite a markup.

Now it goes without saying "exotic" currencies tend to have a higher markup. Some currencies like the Costa Rican Colone for example are very difficult to acquire and even on the wholesale markets can cost large companies upwards of 17% to buy even when buying in bulk. More common currencies like the Euro for example can often be had for about a tenth of a percent.

As you can see the Iranian Rial is being sold at quite a hefty markup. As with anything however, the market determines price and even eBay listings which start at 0.99 cents tend to wind up selling for about $100 or more so that shows us it's not just the currency brokers price gouging, the market is actually willing to pay that price.

It will be interesting to see what the future holds for the Iranian Rial. Will it explode in value, will it slowly go up in value? Will the country dramatically change and roll out a new currency? Only time will tell.

Frank26 Talks About The Iranian Rial Currency

Heard about the recent lifting of sanctions on Iran by the USA and most of the rest of the world? Wondering what it means for the future of the Iranian Rial currency?


Watch the video below and hear what Frank26 has to say?

Is the Iranian Rial making a come-back against the US Dollar?

What does the future hold for the Iranian Rial currency? Only time will tell. Watch this great video which discusses if the Iranian Rial currency is making a come-back against the US Dollars with the recent liftings of US and World Sanctions

Why I Like The Iranian Rial Currency

Seems there's not that much info out there about the Iranian Rial currency, so were here to provide you with news, updates, and inform you about Iran's currency the Rial.


In this video below Currency365, discusses why he likes the Iranian Rial.


Check it out...

Are Iranian Rials Legal to Purchase? And Should You Buy Them?

There has been a big controversy online over the legality of the Iranian Rial for a few months now. Some claiming it was still under sanctions, yet eBay, Amazon and various websites have sold the Iranian Rial currency for quite some time. Though there hasn't really been a clear answer it seems finally as of this past weekend all sanctions were officially lifted.



This video here discusses whether your allowed to purchase the Iranian Rial and if so should you buy them?