In response to stringent United States sanctions, Iranian authorities are reportedly developing informal mechanisms to market oil and obtain vital goods. However, this strategy has raised concerns among judges and experts about the potential for corruption and mismanagement. An increasing number of state-linked “trustees” have emerged to facilitate clandestine oil exports and other transactions, raising alarms over the billions of dollars in revenue that have yet to be repatriated to Iran. This predicament further complicates an already fragile economy plagued by rampant inflation and currency depreciation.

Judicial Concerns Over Trusts and Revenue

Judiciary chief Gholam-Hossein Mohseni-Ejei addressed the issue during a recent conference, expressing his intent to hold these unidentified trustees accountable for the unreturned funds. He questioned the roles of various state institutions, including the Central Bank and the Ministry of Economy, in facilitating these transactions while maintaining that they must ensure the return of the money. Iran has faced challenges for years in retrieving foreign currency revenues from its extensive oil reserves, complicating efforts to stabilize the national economy.

Shift in Oil Financial Management

A former oil executive, Ali Akbar Pour Ebrahim, highlighted a fundamental change in the management of Iran’s oil revenues since the withdrawal of the United States from the nuclear deal in 2018. He indicated that the Petroleum Ministry, which had previously handled oil proceeds directly during Hassan Rouhani’s administration, was relegated under President Ebrahim Raisi’s leadership. Instead, commercial banks have reportedly taken over the management functions, allowing for the emergence of bank trustees. This repositioning has resulted in significant amounts of oil revenue—estimated at up to $11 billion—not returning to the Iranian Treasury.

Accusations of Financial Misconduct

Pour Ebrahim claimed that the trustees, exploiting their positions, had engaged in corrupt practices, including employing individuals from neighboring countries to establish bank accounts in the United Arab Emirates and channeling the funds through shell companies. He noted that the issue had previously been acknowledged by Raisi before his unexpected death in a helicopter accident. Further complicating matters, lawmakers like Hossein Samsami have confirmed allegations of collusion between some banks and trustees to falsely report oil revenue deposits to the Central Bank.

Potential Scale of Misappropriation

Mahmood Khaghani, an experienced oil official, suggested that an independent audit could reveal that misappropriation of funds far exceeds the current $11 billion estimate. He elaborated that a shadow governance structure emerged roughly two decades ago, coinciding with increasing international scrutiny of Iran’s nuclear endeavors. This structure has led to certain individuals within the Iranian government and military participating in oil transactions without proper oversight.

Contingency Plans Amid Escalating Tensions

Despite ongoing challenges, Iranian authorities are indicating a further commitment to utilizing these trustees amid anticipation of potential conflict. Agriculture Minister Gholamreza Nouri Ghezeljeh announced that entities importing essential goods would be able to exchange oil for food supplies, laying groundwork for a barter system. This initiative allows importers to receive oil resources from the Petroleum Ministry, setting a bartering limit of up to $1.5 billion.

Recent Developments in Oil Sales Strategies

In late January, President Masoud Pezeshkian expanded authority to provincial governors to expedite essential imports without relying strictly on foreign currency, enhancing flexibility for transactions amid potential hostilities. Concurrently, a former Ports and Maritime Organization official noted that Iran is pursuing the sale of sanctioned vessels for scrap metal, which would permit the purchase of new, nonsanctioned ships. This initiative aims to navigate U.S. sanctions while maintaining operational capabilities in the oil sector.

Continued Resilience of Oil Sales Amid Sanctions

Officials have suggested that Iranian oil sales remain robust despite U.S. efforts aimed at diminishing exports. The previous administration had intensified measures against tankers carrying Iranian oil and has sought to persuade countries like China to limit purchases. This dynamic continues to unfold as Iran navigates significant geopolitical and economic challenges in the oil industry.

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