# Iran's President Says Foreign Trade Has Fallen About 35 Percent as Washington Targets Dubai

Iran's president, Masoud Pezeshkian, said imported goods are not arriving, while the United States moves against the Emirati banking channels Iranian firms have used for decades.

- Published: 2026-08-29T05:10:48.378Z
- Canonical: https://polylog.news/2026-08-29/iran-s-president-says-foreign-trade-has-fallen-about-35-perc
- Publisher: Polylog (Global desk)
- Section: geopolitics
- Sources: [South China Morning Post](https://www.scmp.com/news/world/middle-east/article/3365679/iranian-leaders-admit-economic-toll-war-us-trade-drops-35), [Financial Times](https://www.ft.com/content/930386eb-b5d4-4a62-a258-f7ab46401655?syn-25a6b1a6=1), [Economic Times](https://m.economictimes.com/markets/commodities/news/oil-settles-lower-on-clues-about-fed-policy-rumors-of-hormuz-deal/articleshow/133603629.cms)

Iranian leaders have begun describing the cost of the conflict with the United States in economic terms. President Masoud Pezeshkian said imports and exports have fallen by between 25 and 35 percent under American sanctions and the naval blockade, and that his government is weighing a doubling of the price of gasoline bought above subsidised quotas, [the South China Morning Post reported](https://www.scmp.com/news/world/middle-east/article/3365679/iranian-leaders-admit-economic-toll-war-us-trade-drops-35). "The route is now blocked, and goods are not coming in," he said in a televised interview. Supreme Leader Ali Khamenei called on the government to address the hardship.

The pressure campaign has moved to the Gulf. The [Financial Times reported](https://www.ft.com/content/930386eb-b5d4-4a62-a258-f7ab46401655?syn-25a6b1a6=1) that the American effort to isolate Iran is now targeting Dubai, which has served for decades as an offshore hub for Iranian trade finance and market access. The State Department has [sanctioned the manager of Bank Melli's Dubai branch](https://www.state.gov/releases/office-of-the-spokesperson/2026/08/u-s-sanctions-sever-financial-lifelines-of-iranian-regime), and the Treasury's financial crimes unit has proposed cutting a United Arab Emirates bank off from American correspondent accounts over transactions it links to Iranian networks. Treasury Secretary Scott Bessent has said countries that keep ties to Tehran should expect to share its isolation. Al Jazeera has reported that the United Arab Emirates, China and Turkey together supply close to [three-quarters of Iran's merchandise imports](https://www.aljazeera.com/news/2026/8/19/uae-trade-embargo-could-shut-irans-key-economic-escape-route-heres-why).

Oil settled lower on Friday as traders weighed both the prospect of Federal Reserve tightening and reports of an arrangement over the Strait of Hormuz, [Economic Times reported](https://m.economictimes.com/markets/commodities/news/oil-settles-lower-on-clues-about-fed-policy-rumors-of-hormuz-deal/articleshow/133603629.cms). Brent traded near $88 a barrel.

## What this means

Cutting Iran off from Emirati correspondent banking targets the payment layer rather than the goods, which is faster and harder to replace than shipping routes. Dubai's re-export businesses and the Emirati banks that handle them lose fee income and face compliance costs, while Chinese and Turkish intermediaries absorb what trade continues, usually outside dollar settlement. That is the mechanism by which sanctions enforcement keeps pushing marginal trade into non-dollar channels, and it is also why each escalation puts a little more risk premium back into crude.

## What to watch

- Whether the Emirati authorities formally restrict Iranian accounts. Compliance would close Iran's largest financial workaround, and refusal would put Emirati institutions themselves in the American penalty system.
- Iranian domestic fuel pricing. Doubling the price of above-quota gasoline would remove a long-standing subsidy under duress and is the kind of measure that has produced street protests in Iran before.
- Confirmation or denial of a Hormuz arrangement involving Oman. Actual reopening of the strait would remove a large part of the current crude risk premium, and a collapse of the talks would restore it.