Driven by the specter of escalating tensions between Iran and Israel, the Iranian rial has plummeted to a historic low, with its value eroded to less than 1/10000th of its pre-Islamic Republic worth against the US dollar.
The US dollar exchange rate surged to over 705,000 rials in Iran's free market on Sunday. One dollar was traded at about 70 rials on average for several years before the Islamic Revolution of 1979.
The rial dropped to 762,000 against the euro and 905,000 against the British pound.
On Sunday, the Tehran Stock Exchange index also plunged by 28,000 points, falling to about 2,032,000 points.
Iranian media usually cite several factors as potential contributors to a rising US dollar rate, including expectations of higher inflation, increased demand for the UAE dirham—a key currency in Iran’s foreign trade amid US sanctions—regional tensions, and the potential for Donald Trump to win the US election.
Iran is already grappling with soaring inflation exceeding 40%, and the rial's continued decline will drive prices even higher, further impoverishing a population that has seen its purchasing power fall significantly since 2018. That year, US sanctions imposed by the Trump administration—following its withdrawal from the 2015 nuclear deal—targeted oil exports and banking, slashing Iran’s income and dealing a severe blow to its oil-dependent economy.
In August, Israel began its punishing attacks on Iran’s proxy, the Lebanese Hezbollah, ultimately killing its leader, Hassan Nasrallah, which led to an Iranian retaliation with ballistic missiles on October 1. The anticipation of the Israeli response, which occurred in late October, took a heavy toll on the economy, with the rial nearing the 700,000 mark several times—a level that holds significant psychological resistance in Iran.
In recent days, numerous Iranian officials have threatened to retaliate against Israel’s October airstrikes, which targeted Iran’s air defenses and missile installations while avoiding nuclear and energy facilities.
Washington directly warned Tehran on Saturday against launching another attack, saying it will not be able to restrain its ally this time, Axios reported citing an American official, amid reports of Iran's preparations for another strike on Israel.
On top of mounting military and economic pressures, President Masoud Pezeshkian unveiled next year’s budget in October, allocating nearly 20% of Iran’s oil export revenue—estimated to exceed $10 billion—primarily to the Revolutionary Guard. In the current budget, the military’s share of oil is around 200,000 barrels per day, while next year it would be an estimated 430,000 barrels.
One might assume that some of these students rose to positions of power. Indeed, some did, but most eventually fell out of favor with Iran’s leaders, with a few even landing in jail. The exact number of those involved remains unknown. Now, 45 years later, only a handful remain untouched—and even they are viewed with disfavor by both the Iranian public and insiders within the establishment.
Former conservative lawmaker Ali Motahari, wrote last November that it was "an unnecessary move that was made with the provocations of leftist groups to serve the interests of the Embassy of the Soviet Union and the Tudeh Communist Party." Many others recall that the 1979 seizure of the US Embassy plunged Iran into decades of hardship, triggering a prolonged war and a crushing economic crisis for its people. But where are those who made that fateful decision?
Masoumeh Ebtekar, the spokesperson for the radical students, eventually rose to become President Hassan Rouhani’s vice president for women and family affairs and previously served as vice president for the environment. Last year, some lawmakers introduced a motion to take her to court over alleged failures in environmental protection.
Ebtekar is married to Mohammad Hashemi Esfahani, another former hostage-taker and who later became an Intelligence Ministry operative, and has been implicated in illicit oil sales. Known to the American hostages as "Sister Mary," Ebtekar was one of the few students who spoke English.
Ebrahim Asgharzadeh, who initially designed and masterminded the embassy seizure, remains active today as a self-proclaimed reformist. However, he is largely shunned by the reformist camp, who view him as an insider closely linked to Khamenei’s circle. According to the Mashregh News website, which is affiliated with Iranian intelligence, Asgharzadeh led the hostage-takers' “central council,” which included figures such as Ali Asghar Zahmatkesh, Abbas Abdi, Hashemi Esfahani, and others.
Abdi soon left the group. He later became the editor of leftist newspaper Salam and is currently a high-profile reformist commentator. He is the only hostage taker who later met with one of the hostages and reportedly apologized for his behavior.
Another well-known hostage taker was Mohammad Reza Khatami, former President Mohammad Khatami's brother and is nowhere to be seen after he fell out with the establishment. Khatami served as a deputy Majles Speaker in the 1990s.
Mohsen Aminzadeh, a prominent figure in the embassy seizure, later became a deputy foreign minister with ties to the Intelligence Ministry. He was jailed after the contested 2009 presidential election but has since been released.
Hossein Kamali went on to serve as Iran’s labor minister and was close to former President Akbar Hashemi Rafsanjani.
Until 1985, the former students held regular meetings at the US Embassy building, where they managed the translation and publication of seized embassy documents. In that year, the Intelligence Ministry took control of the remaining documents, halting further Persian translations. It was then that "The Students Following the Line of Imam Khomeini" chose to dissolve as a group or political organization.
Several former members, including Reza Seyfollahi, Aziz Jafari, and Hossein Dehghan, joined the armed forces. Seyfollahi served as Iran’s police chief for a few years before moving to the IRGC Intelligence Organization. Hossein Dehghan served as Iran’s interior minister for a few years. Aziz Jafari was the IRGC's commander-in-chief for several years until Hossein Salami succeeded him in 2019. Alireza Afshar led the Basij militia for several years before taking charge of the “soft war” department at the National Defense University, while Akbar Rafan was the IRGC’s first air force commander. Several former students lost their lives during the Iran-Iraq War in the 1980s.
Habibollah Bitaraf, who was energy minister under President Khatami, currently faces criticism for policies that allegedly damaged Iran’s environment. Rahman Dadman served as Khatami’s road minister and died in a plane crash. Ezzatollah Zarghami, another former student who joined the IRGC, became deputy culture minister in the 1990s and later headed state television; he was also appointed cultural heritage and tourism minister under President Raisi.
One of the more interesting figures among the students was Mahmoud Ahmadinejad, who declined to participate in the embassy takeover. According to Hashemi Esfahani, Ahmadinejad argued that they should instead target the Russian Embassy.
This is the updated version of a similar article published on this website in November 2021.
