Just to rain on the parade of all the jokers, it is quite a bit bigger under the surface, runs on diesel/electric (that tall mast is the snorkel, which folds down into the hull behind the conning tower when submerged), and has two torpedo tubes which apparently can also launch anti-ship missiles. The crew is probably six, as noted.
My guess on the color is that it was temporarily painted like that to make it easier to see during a parade flotilla, since it really isn’t all that big and doesn’t project that far above the surface. From a distance, it’s not much bigger than a towed paravane.
What's driving the Iranians to prance around like peacocks? Are they showing off to the USA or their neighbors? In recent years they've developed a very bad case of vanity. Vanity leads to envy which develops into hate which develops into war. It's the normal cycle of human evolution in progress. God must have created humans for the laughs.
Agree with your comments about the submerged portion of the submarine being a lot bigger that what is showing on the surface.
The unusual paint job maybe, as you write, simply intended to make it more visible during surfaced flotilla parades. However, IIRC, the Persian Gulf /Straits of Hormuz are pretty shallow bodies of water. When seen from above, a turquoise-painted submarine operating at or just below the surface might gain some protection from being nearly the same color as light being reflected up from the bottom in shallow water. Once the bottom drops to greater depths correspondingly less light is reflected up from the bottom and a darker color (like black) probably works better to conceal the submarine from observation when working at shallow depths.
Just a thought from a nonexpert.