Iran Update, October 7, 2025
Iran is pursuing alternative mechanisms, which may include barter systems, to mitigate the impact of snapback sanctions. Iranian Government Spokesperson Fatemeh Mohajerani stated on October 7 that the Iranian government aims to counter snapback sanctions by deepening ties with neighboring countries and international blocs such as the Eurasian Economic Union, BRICS, and Shanghai Cooperation Organization.[1] Mohajerani added that the Iranian government will also use barter mechanisms to sustain trade.[2] An Iranian trade official similarly stated on October 7 that the Iranian government is preparing alternative ”mechanisms“ to reduce the impact of snapback sanctions on Iran’s trade agreements.[3] The United Nations Security Council (UNSC) reimposed snapback sanctions on Iran on September 27, and the European Union (EU) reimposed sanctions on Iran on September 29.[4]
These alternative mechanisms may include barter systems that bypass sanctions. US media previously reported on October 5 that Iran and China have used barter systems that bypass dollar transactions to evade US sanctions since at least 2018, including via the exchange of Iranian oil and metals for Chinese goods and infrastructure projects.[5] Unspecified officials told the Wall Street Journal on October 5 that China funded infrastructure projects in Iran in 2024 in exchange for 8.4 billion US dollars of Iranian oil.[6]
Iran’s moves to mitigate sanctions are probably driven by concerns that sanctions on the Iranian economy will trigger an economic downturn. The World Bank forecasted in its October report that Iran will face an economic downturn over the next two years.[7] The World Bank stated that the Iranian economy will shrink by 1.7 percent in 2025 and 2.8 percent in 2026, which is a change from the World Bank’s April 2025 forecast of 0.7 percent growth in 2026.[8] The World Bank attributed this decline to reduced oil exports and non-oil economic activity due to the reimposition of UNSC sanctions and economic disruptions that followed the Israel-Iran War. The World Bank’s assessment comes amid the reimposition of sanctions on Iran and after several countries, including Canada, New Zealand, Australia, and Turkey, stated that they would abide by UNSC measures.[9]
The Hamas-Israel ceasefire in the Gaza Strip is a framework ceasefire agreement and not a comprehensive agreement to end the war. Hamas and Israel continued to hold indirect negotiations on US President Donald Trump’s ceasefire plan in Egypt on October 7, which demonstrates that both sides view the plan as a starting point or framework for further negotiations rather than a comprehensive agreement to end the war.[10] Hamas leaders agreed on October 3 to release all living and deceased Israeli hostages during the ceasefire and expressed openness to negotiate on other elements of the US plan.[11] Hamas and Israeli officials first held talks on October 6 to discuss the roadmap for future negotiations and ceasefire mechanisms.[12] The officials discussed an Israeli withdrawal from the Gaza Strip and a timetable for a hostage exchange during talks on October 7.[13] Hamas and Israeli officials have not discussed other key aspects of the US plan for peace in the Gaza Strip, such as governance over the Gaza Strip and Hamas’ disarmament.[14] Israeli and Hamas officials are expected to continue negotiations for several days, with US officials joining the talks on October 8.[15]
Anti-regime fighters killed two Islamic Revolutionary Guards Corps (IRGC) security personnel and wounded three others in an attack on an IRGC operational base near Iraqi Kurdistan on October 6.[45] Kurdish anti-regime armed groups may be responsible for the attack due to the location and demographics of the area. Iranian and Iraqi officials agreed in March 2023 that Iraqi authorities would disarm and relocate members of Kurdish opposition groups away from the Iran-Iraq border to address Iranian concerns about the groups’ activities.[46] The Iranian regime has historically accused Israel of using Iraqi Kurdistan and Kurdish opposition groups to conduct operations against Iran.[47]
https://understandingwar.org/research/middle-east/iran-update-october-7-2025/
Iran Update, October 8, 2025
Iranian officials have threatened to close the Strait of Hormuz, likely to try to discourage the United States from enforcing sanctions that target Iranian oil exports. An Iranian parliamentarian warned on October 4 that Iran would close the Strait of Hormuz if the United States or its allies prevent Iranian oil exports.[1] The head of the Iranian Armed Forces Judicial Organization similarly warned on October 5 that Iran would not allow a US presence in the Persian Gulf to threaten Iran’s economic or military security.[2] US President Donald Trump reinstated his maximum pressure campaign against Iran in February 2025 to prevent Iran from obtaining a nuclear weapon and curb its influence abroad.[3] Trump’s maximum pressure campaign seeks to drive Iranian oil exports “to zero.”[4] The United States previously seized Iranian oil tankers and weapons shipments between May 2018 and January 2021 as part of the first Trump administration’s maximum pressure campaign.[5] Reuters reported in March 2025 that the United States was considering a plan for the United States and its allies to halt and inspect Iranian oil tankers at sea.[6] Iran previously attempted to close the strait in 2019 in response to the US maximum pressure campaign by sabotaging Emirati tankers, seizing British ships, and launching cruise missiles at Saudi oil facilities.[7] Iranian officials’ threats to close the Strait of Hormuz come as Iranian military commanders have recently increased inspections of naval units in the Persian Gulf, including naval units deployed at the Nazeat Islands.[8] The Islamic Revolutionary Guards Corps (IRGC) deployed naval mines, ballistic and anti-ship cruise missiles, and fast attack craft to these islands in May 2025.[9] Iranian state-controlled outlet Mehr News detailed Iran’s anti-ship missile capabilities on October 7 and highlighted Iran’s development of new cruise missiles that reportedly have fully automated guidance systems.[10] These capabilities could support a potential Iranian effort to close the Strait of Hormuz.
The Popular Mobilization Forces (PMF) arrested several unidentified individuals in Anbar and Dhi Qar Provinces on October 2 and 8 for suspected Baath Party ties in what appear to be instances of sectarian targeting.[11] The PMF Intelligence and Information Department launched a campaign on October 2 to pursue Baath Party remnants.[12] The PMF is an Iraqi state security service that includes several Iranian-backed Iraqi militias, some of which report to Iran instead of the Iraqi Prime Minister.[13] The 27th PMF Brigade, which the Iranian-backed Badr Organization controls, arrested a man in Karma District, Anbar Province, on October 2 for promoting Baath Party ideology.[14] PMF intelligence units separately arrested several alleged “senior” Baath Party members in Nasiriyah, Dhi Qar Province, on October 8.[15] Prominent Iraqi Shia politicians have commonly conflated Sunnism with membership in the Sunni-dominated Baathist government under Saddam Hussein and have abused de-Baathification measures to target Sunnis.[16]
It is unclear if these arrests are related to the upcoming November 2025 parliamentary elections, but the arrests come as multiple Iranian-backed Iraqi actors have sought to disqualify alleged Baath Party remnants ahead of the elections.[17] CTP-ISW previously assessed that Iraqi Shia politicians are likely attempting to sideline Sunni political opposition ahead of the November 2025 elections by accusing their opponents of having Baathist ties.[18] Iraqi law prohibits Baath Party members from participating in political activities, including competing in elections.[19] Iraqi Shia political parties have weaponized this law and other de-Baathification mechanisms to target Sunnis, particularly Sunni political opposition.[20]
Iranian, Azerbaijani, Russian, and Kazakh naval commanders signed a strategic cooperation agreement in Russia on October 8 in response to concerns about external influence in the region.[21] The agreement stipulates that “no foreign country or extra-regional power” shall intervene in Caspian Sea affairs. Turkmenistan, which also borders the Caspian Sea, did not sign the document. Iranian leaders have raised concerns about extra-regional influence in the Caucasus and the Caspian Sea in response to discussions about the construction of the Zangezur Corridor.[22] The Zangezur Corridor is a Turkish and Azerbaijani-proposed transit route that would grant Turkey access to the Caspian Sea.[23]
https://understandingwar.org/research/middle-east/iran-update-october-8-2025/