Panic in Tehran: Iranians Dump Savings for Gold as War Fears Surge

Mass Exodus to Safe Havens

The ongoing tension with Israel has deeply unsettled the Iranian public, triggering a massive, fear-driven shift in the country's economy. Reports from Tehran's Grand Bazaar reveal a run on gold, foreign currency, and other precious metals unprecedented in recent memory.

Traders state that every new headline, whether concerning UN sanctions, the plunging value of the Rial, or the possibility of renewed hostilities with Israel, sends Iranians flocking to exchange their vulnerable savings for easily transferable assets. The public is seeking financial shelters that they believe will retain value even if a crisis escalates.

Jewelry vendor Manzer, 28, told the Associated Press that he sold six kilograms of gold in just two weeks. "People are rushing to buy because they are afraid their savings will be eroded," he explained.

For many Iranians, gold is seen as the only reliable safe haven against rampant inflation. Behzad Rashvand, 57, summarized the prevailing sentiment: "Every time I earn money, I convert it into gold. It's the only way to maintain value."

Price Surge and the Rise of Silver

The surge in demand has driven prices to historic highs. One-gram gold bars (18-karat) sold for around 115 million Rials last summer, equivalent to about $100 at the current exchange rate, which has fallen to over one million Rials per dollar. Gold coins recently crossed the 1.2 billion Rial threshold, an all-time record.

Even silver, once less prominent, has become a popular investment. Kilogram silver bars now trade for nearly $2,000, and smaller 100-gram silver bars have become a favored option for middle-class families seeking secure assets.

Fatemeh Parsa, a mother of two, regretted investing her inheritance in a Tehran apartment, noting that property values have far outpaced public affordability, while gold would have yielded a much higher return. "Now it seems that investing in silver could be better, especially for the children," she said.

Paradoxically, while the middle class buys, some affluent families are being forced to sell their gold and jewelry, struggling to maintain their accustomed standard of living. Amir Ramazani, a senior trader, explained: "Their income no longer matches the life they used to live."

The Need for Portable Wealth

The economic pressure from years of sanctions, damage to local industries, and the difficulty of moving funds abroad are compelling Iranians to seek assets that can be physically carried in an emergency. This trend is intensified by the fear of a new war with Israel.

Wealthier investors are now turning to diamonds and gemstones, valued for being discreet, high-value, and extremely portable. Jewelers in Tehran and Mashhad report surging demand for small, high-quality stones, a commodity previously purchased only by professionals.

The fear of war is not abstract. During "Operation With the Lion," tens of thousands of residents fled Tehran, moving to the north and to villages, discovering congested roads and emptied ATMs. Many carried every piece of liquid saving they could hold. Iranians remember the historical precedents: the mass flight during the Iran-Iraq War and the 1979 exodus of the Shah's loyalists, who took gold, jewelry, and other mobile assets with them.

Ahmed, a 49-year-old fabric importer, is already preparing for that scenario: "In the last two months, I have been converting all liquid assets into foreign currency and gold. If I have to leave, I must take the money with me."