Iranian president says government ‘ashamed’ over energy crisis

“This year, we let the dear people of Iran down and were forced to cut their electricity. At times, we also had to cut off electricity and gas to producers because of inefficient consumption,” Masoud Pezeshkian said on Thursday, calling for reduced reliance on foreign energy sources.

“The process we went through this year was by no means acceptable, and we must strive to move out of this situation next year.”

But power cuts are just one symptom of a worsening economic crisis. Government offices, banks, and schools in most of Iran’s 31 provinces have been closed for almost 12 days in the past month due to severe energy shortages.

With Iran already observing 28 official holidays per year, such additional shutdowns have paralyzed public services. The IRGC-affiliated Tasnim News Agency reported that school closures alone cost the country "10,000 billion rials per day" (over $10 million) and have significantly impacted student learning.

A teacher described the consequences to Shargh daily: “On the one hand, our income is cut with every closure since, unlike other teachers, we do not have fixed salaries. If it snows one day and schools are closed, we do not receive that day’s salary. Now, look at how many closures we’ve had this year.”

The country’s economic crisis runs deeper. Inflation reached 32% for the 12 months leading up to February 2025, according to the Iranian Statistics Center.

Over the past five years, annual inflation has hovered around 40%. The Iranian currency, the rial, has depreciated by more than 50% since September while the US has reinstated it “maximum pressure” policy on Iran over its nuclear ambitions while the Iranian Supreme Leader still calling the negotiations with the US unwise.

With the currency in freefall, the average monthly income has dropped from nearly $200 to just $120, while basic living expenses require at least $500. As a result, over 30% of Iranians now live below the poverty line.

Officials argue that raising wages would drive inflation higher, but labor relations expert Fatemeh Azizkhani dismissed this idea.

“Even if they increase wages by 100%, it will only cover part of the needs of working families,” she told Event 24, warning that failing to adjust salaries for inflation would push workers into critical conditions, over one third of Iranians now living below the poverty line in the worst crisis since the founding of the Islamic Republic.