Tehran, Iran – Iranian authorities have rejected claims that Iran is unable to support its regional allies, but acknowledged that the United States’ sanctions and the war have created financial challenges. US Central Command chief Brad Cooper claimed last week that a combination of military attacks and a naval blockade of Iran’s southern ports “has dealt severe blows” to the country. The admiral said the US had prevented at least $25bn in Iranian crude exports and helped freeze approximately $350m in cryptocurrency assets.
This means the Iranian Revolutionary Guard Corps (IRGC) are now unable to pay their soldiers and Iran-linked regional groups suffering from financial shortfalls. This is being portrayed as a victory for the US in its war with Iran, which so far has shown very few tangible victories for Washington. Michael Knights, head of MENA research at US-based intelligence and geopolitical risk advisory firm Horizon Engage, said Hezbollah in Lebanon and the Houthis in Yemen have suffered financially during the past few years.
For decades, the IRGC Quds Force has supplied money, weapons, components, training and manufacturing expertise to regional allied groups. It has enabled partners at loggerheads with the US and Israel to assemble or produce a number of weapons locally, according to United Nations experts and US officials. The axis groups also draw on businesses, including oil exports, as well as donations and local resources to fund their operations.
Some Iraqi factions have been integrated into the official security forces and receive government funding through the Popular Mobilisation Forces. Allied commercial networks in Iraq are selling Iranian commodities and distributing proceeds through intermediaries and exchange houses, the US Department of the Treasury has claimed. This has put them in a better financial position than their “poorer cousins” in Hezbollah and the Houthis, Knights said, with some money allegedly flowing from Iraq towards Iran in recent years.
The US Treasury alleged in September that Kataib Hezbollah, a prominent Tehran-backed Shia Muslim armed group in neighbouring Iraq, siphoned Iraqi resources to support Iran. The Treasury also described substantial earlier transfers from the Quds Force to Hezbollah, depicting flows in both directions. A report by the news agency earlier this month cited unnamed sources as saying Hezbollah received $200m from Iran in September.
The US State Department rejected the report at the time, saying Hezbollah was “trying to save face with fake stories about cash influxes from Iran”. Iran’s economy has taken hit after hit in recent years due to war, domestic mismanagement and sanctions. This has led to runaway inflation, low-paying jobs, a depreciating national currency and isolation from the global community for 90 million Iranians.
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