The Tehran Stock Exchange faces the test of war

February 28, 2026 may well mark the start of the military confrontation between Iran and the United States, but the standoff between the two countries is in reality much older. Concretely, Tehran has had to deal with American sanctions since 2010: exclusion from the banking system, oil embargo, financial restrictions, freezing of certain assets… The situation eased in 2016 and 2017 following an agreement with the Obama administration, but this one was torn up by Trump in 2018…

While certain sections of the economy have been violently impacted by these measures – a large part of the banking system is, for example, excluded from the SWIFT system -, “the sanctions may also have contributed to strengthening the resilience of certain parts of the economy”, points out to Zonebourse Katayoun Maleki, doctoral student in political science and head of the desk “Industry, Mines and Commerce” at Eghtesad Online/EcoIran, one of the most consulted Iranian economic information sites in the country.

“In the steel industry, sanctions have, for example, pushed companies to produce locally, thus reducing dependence on foreign currencies and creating jobs in the manufacturing sector,” continues this specialist. “But many companies are also forced to bear additional costs linked to sanctions evasion.”

The Tehran Stock Exchange, a playground for local traders

The Iranian financial market is opaque to foreigners and the Tehran Stock Exchange remains above all the prerogative of local traders. Indeed, “access to the market is impossible and access to information is very complicated”, underlines Thierry Coville, researcher at IRIS (Institute of International and Strategic Relations) and specialist in the Iranian economy.

The TEDPIX, the flagship index of Tehran’s stock market, brings together between 600 and 700 listed companies, with a strong component of petrochemical companies (Persian Gulf Petrochemical Industries, Tamin Petroleum & Petrochemical Investment), but also banks (Bank Mellat, Bank Tejarat and Bank Saderat Iran…) as well as industrial groups such as Mobarakeh Steel Company and National Iranian Copper Industries (NICICO). There are also automobile manufacturers, such as Iran Khodro Company and Saipa Group, as well as telecoms players such as TCO and MAPNA Group.

“The total capitalization of the Tehran Stock Exchange is very volatile due to high inflation, exchange rate fluctuations and variations in rial valuations compared to the dollar,” underlines Katayoun Maleki, referring to a changing valuation, between 100 and 500 billion USD, or around 3 to 15% of the total valuation of the CAC 40.
Since the start of the war, however, data relating to TEDPIX is no longer available. And for good reason: the capital market has simply closed.

“The reopening of the Stock Exchange requires the approval of the Supreme Council of the Stock Exchange. A meeting was held on May 2, during which it was decided that a final decision regarding the reopening would be taken quickly,” adds Katayoun Maleki.

A market disconnected from international flows

According to Thierry Coville, access to data from the Tehran Stock Exchange is however not essential to take the pulse of the Iranian economy. “In reality, in the Iranian case, the link between the stock market and the macroeconomic situation is almost non-existent,” points out the specialist.
For him, the evolution of prices is very speculative while the rest of the economy must deal with international sanctions. “We can even talk about a repressed financial system: you have negative real interest rates. And even if there are private banks, in reality, everything is very much controlled by the State.”

The mullahs’ regime does not hide the interest it has in the development of international financial markets. It is also on this ground that part of the war with the United States would be played out, Mohammad-Bagher Ghalibaf, president of the Iranian Parliament, said in April. “The real front line is the yield curve of American bonds. And the global financial system, largely centered on the United States, is not as solid as it seems,” he assured, calling on the markets to sell American bonds.

Oil, the regime’s ultimate life insurance?

If Ayatollah Ali Khamenei was eliminated on the first day of the conflict, the regime showed unexpected resilience. It must be said that Tehran has a solid asset: according to Frédéric Lorec, oil specialist at AlphaValue, the Iranian subsoil covers some 209 billion barrels of oil, which would make it the third largest reserve in the world. Daily production was also estimated at the start of the year between 4.5 and 4.7 Mb/d (million barrels per day), placing the country among the world’s leading producers.

These reserves constitute a real financial windfall for the Islamic Republic… provided that the sanctions are ignored. Shadow trade via rail, offshore transshipments… “Iran has managed to develop a parallel export system, shipping around 1.8 to 2.3 Mb/d, mainly to China. These barrels are already integrated into Asian balances and constitute a hidden source offer for the market”, analyzes Frédéric Lorec.

For years, this discreet trade between Tehran and Beijing would have been more or less tolerated by the Biden administration, Thierry Coville believes.
And even with a discount of 7 to 12 USD per barrel, these exports help support the Iranian economy. However, they are not without consequences: Beijing regulates deliveries in yuan, a currency which is not freely convertible or usable and which contributes to reducing the country’s “useful” reserves by adding downward pressure on the rial.

Inflation that is doubling

This pattern would thus contribute to galloping inflation: this is estimated by the IMF at more than 50% in 2025 and anticipated at nearly 70% for 2026.
“Prices of basic foodstuffs increased sharply in January 2026 following a sharp depreciation of the Iranian rial, which exerted upward pressure on food prices across the country,” underlines a report from FAO, the Food and Agriculture Organization of the United Nations.

Grace, a young Iranian living in Tehran contacted by Zonebourse, agrees: “Prices are increasing drastically, almost every two weeks. Food, household products, cooking oil… nothing escapes the consequences of this war.”
According to her, many people were already struggling to meet their basic needs before the war. “Obviously, the situation is even worse today. And the effects of this inflation are now compounded by blockades and the destruction of factories,” she adds.

The Israelis thus claimed to have destroyed some 70% of the Iranian steel industry. A sign of the regime’s agitation, the Iranian customs authorities published a directive at the end of April banning the export of several steel products.

“This is not surprising,” comments Thierry Coville. “This industry is at the heart of the economy, with its share of subcontractors and its customers, such as the automobile industry, household appliances, etc. So the regime has a huge interest in ensuring that production is maintained inside Iran. Otherwise, many companies will stop operating.”

According to several estimates, the war has already left between 1 and 2 million Iranians unemployed. Grace is also one of them. The young woman worked freelance on the Internet until the war. “The number one priority is access to the Internet, as quickly and as cheaply as possible, access that cannot be hacked, blocked or filtered,” she explains. “The use of tunneling configurations has become the only option, often expensive and easily detected and then shut down.”