Iran’s foreign trade has contracted sharply since the conflict with the United States began, with non-oil exports and imports falling by around a quarter or more, according to customs data released after months of delay.
Iran exported about $15 billion worth of non-oil goods, including natural gas and LPG, through August 16, nearly five months into the Iranian calendar year that began on March 21. That was nearly 30% below the figure reported for the first five months of the previous year.
Imports fell to about $17 billion over the same near-five-month period, about a quarter below the full five-month figure reported a year earlier.
The figures show a sharp deterioration in Iran’s trade during a conflict that has disrupted key industries and shipping routes, adding to an economy already struggling under years of sanctions, declining oil revenues and chronic shortages of foreign currency.
The United States has intensified economic pressure on Tehran since the conflict began on February 28, while imposing a maritime blockade on Iran amid disruptions to shipping through the Strait of Hormuz.
Iranian customs authorities have not published a detailed breakdown of the decline in non-oil exports. But the latest figures indicate that non-oil exports have fallen for a second consecutive year, with the current near-five-month total roughly a third below the level recorded in the first five months of 2024.
Imports have performed even worse over the longer period, with the latest total nearly 40% below the first-five-month figure recorded in 2024.
Petrochemicals and steel hit by strikes
The deterioration comes after attacks disrupted two of Iran’s most important non-oil export industries: petrochemicals and steel.
Iran exported about $45 billion in non-oil goods during the previous Iranian fiscal year, with petrochemicals and steel accounting for roughly $17 billion, or 37% of the total.
Israeli strikes in March hit Iran’s major petrochemical hubs in Mahshahr and Asaluyeh, as well as major steel producers including Mobarakeh Steel and Khuzestan Steel.
The Iranian government subsequently halted the export of a wide range of petrochemical and steel products for two to three months. Some export permits were later restored, but the government has not disclosed how much these industries exported during the first five months of the current year.
That makes it difficult to determine precisely how much of the overall decline in non-oil exports was caused by disruptions to these sectors.
But given their importance to Iran’s export earnings, any prolonged disruption to production, transportation or overseas sales would have a significant effect on the country’s trade balance.
Oil exports fall even faster
The decline in Iran’s oil exports appears to have been even steeper.
Iranian customs authorities do not publish oil-export figures. Kpler data seen by Iran International, however, show that Iran’s average daily crude-oil and condensate sales to China during the first five months of the current Iranian year were slightly above 1 million barrels per day, about 40% below the same period last year.
Iran’s total fuel-oil exports to international markets also fell sharply, averaging about 96,000 barrels per day, down 57% year on year.
The decline has accelerated in recent months.
Iran’s oil shipments to China, its main customer, have fallen to roughly 520,000 barrels per day this month, while the average over the previous two months was about 800,000 barrels per day, according to Kpler estimates.
That compares with roughly 1.7 million barrels per day of crude oil and condensate sold to China at the beginning of the conflict.
Iran’s fuel-oil exports have also dropped from an average of about 220,000 barrels per day at the start of the war to 61,000 barrels during August.
The collapse in fuel-oil exports has also coincided with a sharp deterioration in Iran’s trade with the United Arab Emirates.
The UAE was Iran’s largest fuel-oil customer last year, accounting for more than 70% of Iran’s fuel-oil exports. But following widespread Iranian attacks on the UAE, the trade has been almost suspended.
Malaysia, Singapore and China have also largely stopped buying Iranian fuel oil since the beginning of the conflict.
Mounting pressure on Iran’s economy
The combined decline in oil and non-oil exports is likely to put further pressure on Iran’s already strained foreign-exchange position.
At the same time, the fall in imports suggests that Iranian companies and consumers are facing increasing difficulty accessing foreign goods, raw materials, machinery and intermediate products.
The trade figures therefore point to a broader deterioration than a simple decline in exports. Iran is simultaneously losing export revenue and reducing its ability to import the goods needed to sustain domestic production.
If the decline in oil shipments persists, pressure on Tehran’s foreign-currency reserves and its ability to finance imports could intensify further in the coming months.
For an economy heavily dependent on oil revenue and imports of industrial inputs, the latest figures suggest that the economic costs of the conflict are extending well beyond the energy sector.
The original article was published on Iran International