With oil prices below $40, the Iranian economy is feeling the pain. Unemployment numbers remain high in addition to the inflation rate which is likely to climb should President Ahmadinejad successfully pass his proposed budget reforms.
Many government parliamentarians are voicing their concerns and opposition to Ahmadinejad's plan to increase subsidies, claiming the state cannot afford such policies without pushing inflation higher.
Critics of the president are also accusing Ahmadinejad of squandering Iran's massive cash infusion when oil prices reached upwards of $140 a barrel. Instead of investing in infrastructure and building up their cash reserves, the president spent majority of the cash windfall on subsidies.
Should oil prices remain as low as they currently stand, watch out for increased unrest among the public and Iranian street.
1 comments:
With oil prices still relatively low (though slowly increasing), what's your current take on the impact in Iran?
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