Soaring prices, street deaths and chants of ‘Mullahs must leave Iran’: What’s fueling Iran’s unrest | Explained

Deadly clashes and currency collapse: Why Iran is witnessing its biggest protests in three years

• Iran sees major unrest due to soaring inflation and currency collapse.
• At least seven killed as protests spread, with violence in multiple cities
• Government pledges reforms and dialogue but maintains heavy security crackdown

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Iran is witnessing its most serious unrest in three years as nationwide protests over worsening economic conditions entered a fifth day on Thursday, with fresh violence reported across multiple cities and at least seven people killed, according to Iranian media and rights groups.

The demonstrations began in Tehran on Sunday and quickly spread to other parts of the country after students from at least 10 universities joined the protests earlier this week. What started as anger over soaring prices and a collapsing currency has escalated into widespread street unrest, prompting a heavy security response.

What sparked the protests?

The protests erupted after shopkeepers and traders took to the streets to oppose the government’s handling of a sharp fall in the Iranian rial and rapidly rising prices, Reuters reported. Iran is grappling with inflation exceeding 40%, while the rial has lost nearly half its value against the US dollar in 2025 alone.

Merchants, shop owners, and students have staged demonstrations for days, shutting down major bazaars in several cities. Years of US and Western sanctions linked to Iran’s nuclear programme, combined with rising regional tensions, have deepened the country’s economic distress.

Where has violence been reported?

According to Iranian media and rights groups, unrest overnight into Thursday turned deadly in several regions. The semi-official Fars news agency and Kurdish rights group Hengaw reported deaths in Lordegan, a city in western Iran. Authorities confirmed one death in Kuhdasht, also in west Iran, while Hengaw reported another fatality in the central province of Isfahan.

Although protests have slowed in Tehran, they have intensified elsewhere. The most severe violence was reported in Azna, about 300 kilometres from the capital, according to multiple reports.

IRNA, Iran’s state-run news agency, said a 21-year-old volunteer from the Islamic Revolutionary Guard Corps’ Basij force was also killed.

The Guard member “was martyred... at the hands of rioters during protests in this city in defense of public order,” said Saeed Pourali, a deputy governor in Lorestan province. "Another 13 Basij members and police officers suffered injuries."

Why is Iran facing an economic crisis?

Iran’s protests are rooted in a deepening economic crisis marked by soaring inflation and a collapsing national currency.

Official data from the state statistics centre showed inflation reached 42.2 per cent in December, up 1.8 percentage points from November. Food prices surged 72 per cent year-on-year, while health and medical costs rose 50 per cent.

The rial fell to a record low over the weekend, trading at around 1.42 million rials to the US dollar on the unofficial market, compared with about 820,000 a year ago. On Monday, the currency stood at roughly 1.38 million to the dollar.

IRNA reported that mobile phone vendors were among those hardest hit, as the rapid depreciation threatened their businesses. Protesters were heard chanting slogans condemning the plunging exchange rate at Tehran’s main bazaar, forcing merchants to halt trading.

“In some sectors, the level of trade activity was reduced to a minimum, and many units preferred to refrain from conducting transactions to avoid potential losses,” IRNA said.

Government response and security crackdown

Iranian officials have blamed protesters for the violence while acknowledging public frustration over economic hardship.

On Monday, Chief Justice Gholamhossein Mohseni Ejei warned that “anyone who engages in hoarding (foreign currency) is a criminal and must be dealt with firmly.”

Pourali said authorities recognised the economic roots of the unrest but cautioned against violence.

"The protests that have occurred are due to economic pressures, inflation and currency fluctuations, and are an expression of livelihood concerns. The voices of citizens must be heard carefully and tactfully, but people must not allow their demands to be strained by profit-seeking individuals," he said.

Videos circulating on social media showed crowds chanting “Shameless! Shameless!” as gunfire could be heard in the background.

Iran’s Fars news agency reported that buildings were “severely damaged” during clashes and that police detained several people described as “ringleaders.” Security forces, including the Basij paramilitary, remain deployed across affected areas.

A critical moment for Iran’s leadership

Experts say this is the largest protest movement since 2022, when nationwide demonstrations followed the death of 22-year-old Mahsa Amini in police custody.

The unrest comes at a volatile time for Iran’s clerical leadership. The economy remains under pressure from long-standing Western sanctions, while tensions have escalated following Israeli and US airstrikes in June that targeted Iran’s nuclear infrastructure and military leadership.

Iran was also involved in a 12-day air conflict with Israel in June, further straining state finances and public confidence.

Iranian-American journalist and author Masih Alinejad shared several videos of the protests on X, highlighting chants heard across the streets.

“Many videos are coming in from Iran, showing people chanting in unison in the streets: 'Mullahs must leave Iran' and 'death to the dictatorship...' This is the voice of a people who do not want the Islamic Republic,” she wrote.

Is Iran open to talks?

Iran has said it is no longer enriching uranium at any site and has signalled openness to negotiations over its nuclear programme to ease sanctions. However, talks have yet to materialise, with US President Donald Trump and Israeli Prime Minister Benjamin Netanyahu warning Tehran against reviving its atomic activities.

Government outreach efforts

Tehran has combined a security response with attempts at dialogue. Government spokesperson Fatemeh Mohajerani said authorities would hold direct talks with representatives of trade unions and merchants, though details remain unclear.

President Masoud Pezeshkian addressed the unrest on social media, pledging economic reforms.

“The livelihood of the people is my daily concern,” he wrote on X, adding that the government plans to “reform the monetary and banking system and preserve the purchasing power of the people.”

He also said he had asked the interior minister to “hear the legitimate demands of the protesters through dialogue with their representatives.”

Defending his government’s proposed budget, which includes a 20 per cent wage hike amid inflation near 50 per cent, Pezeshkian vowed to tackle inflation and rising living costs.