TEHRAN—Iran's Oil Minister Mohsen Paknejad resigned this week, days after allegations surfaced that a trust responsible for selling Iranian oil abroad owed the state nearly $2 billion in export receipts. President Masoud Pezeshkian accepted the resignation, citing personal reasons.
Paknejad's departure occurs as Iran faces severe economic strain marked by 85 percent inflation and a 10 percent contraction in its economy during the first three months of the year. The rial has fallen more than 10 percent in value over the past month, marking one of the steepest declines since the 1979 revolution.
U.S. sanctions severely restrict Iran's ability to sell oil on global markets. To circumvent restrictions, Iran has relied on informal networks, known as "trustees," to repatriate oil revenues.
Last week, the Farhikhtegan newspaper reported that a trust established under Paknejad's oversight to recover income from overseas oil sales allegedly owed the state-owned National Iranian Oil Company approximately $2 billion. The report claimed three individual trustees each owed NIOC hundreds of millions of dollars.
Reza Sepahvand, a spokesperson for Iran's parliament's energy commission, announced an inquiry into the allegations. Some observers suggest that leaks feeding the reporting may indicate an internal power struggle within Iran's oil industry.
State media quoted Paknejad before his resignation as saying that oil sales revenues were still being received. After stepping down, he dismissed claims by President Donald Trump that the resignation was linked to Iran having "no oil," saying his departure was unrelated to Trump's statements on Iran's economy.
Emergency government meetings held over the weekend to address the economic crisis yielded little progress. Reports indicate a growing number of teachers, nurses and other professional middle-class workers are resigning because their salaries cannot keep pace with rising prices.
The president raised complaints about revenue management with the oil minister but did not receive a satisfactory response, according to reports. Allegations of mismanagement or corruption are unlikely to boost public confidence at a time when most Iranians are experiencing steep declines in living standards.
Iranian diplomats are not planning new concessions despite concerns that ongoing sanctions could fuel unrest. The decision follows President Trump's rejection a week ago of a proposal to accelerate nuclear negotiations.
