Oil, gas and Iran economic analyst
Capital flight from Iran’s stock market has intensified since the June war with Israel, with retail investors pulling half a billion dollars—much of it appearing to shift into gold or exit the country altogether.
The trend highlights a deepening crisis of confidence that extends well beyond the battlefield.
Roughly 450 trillion rials ( $500 million) in individual investor funds have exited the Tehran Stock Exchange (TSE) since the 12-day conflict began on June 13.
For a market valued at about $100 billion, of which retail holdings make up less than 10%, this scale of withdrawal is striking.
Though the war ended with a ceasefire on June 24, capital outflows have continued. The benchmark TSE index has yet to recover, indicating sustained unease among ordinary investors.
Safe havens over stocks
No official data is available on how capital is shifting across asset classes, but given the prolonged stagnation in Iran’s housing market, much of the capital exiting equities appears to be flowing into gold.
Recent data from the World Gold Council, published July 31, confirms the trend. In the second quarter of 2025, gold coin and bullion purchases in Iran rose by 20%, while jewelry demand increased by 12%, despite record global prices.
Iran was the only major country to record a rise in jewelry consumption during this period.
Crisis Habits Repeat
The summer of 2022 offers a telling parallel.
Iranian rial lost almost a third of its value during that year’s widespread protests—widely known as the Woman, Life, Freedom movement. The currency fall sparked a surge in gold buying that hit the highest level since mid-2018, when the US reimposed oil sanctions.
In recent years, Tehran has eased restrictions on gold imports to bypass banking sanctions. Exporters are now allowed to bring in gold instead of repatriating foreign currency, which would be subject to strict exchange rate controls or forced conversions.
As a result, Iran imported more than 100 tons of gold in 2024—worth over $8 billion. That figure is triple the previous year’s and represents roughly 11% of total imports, an extraordinary share for a single non-industrial commodity.
In a climate of banking restrictions, currency volatility, and public mistrust in the rial, gold has become the most accessible safe haven for Iranian capital.
Offshore Exodus
Precise figures for capital flight during spring 2025 are not yet available. But the Central Bank of Iran estimated that about $20 billion left the country each year in 2023 and 2024—six times more than in 2018.
For a country with a GDP of around $400 billion in 2024, such persistent outflows are economically devastating.
They signal not just financial instability, but a broader collapse of trust in the domestic system, both economic and political.
