New elections could mean unrest and higher oil prices, but pressure on the regime for reform could ultimately see more supply—in the long-term.
A helicopter crash in Iran has resulted in the deaths of the Iranian President Raisi and his hard-line foreign minister and could ultimately affect oil markets if it produces a change in the government’s policies. Of course, the Iranian president is more a mirror than a lamp, reflecting the wishes of the Ayatollah Khameini and that will not change. However, new elections will increase the possibility of domestic turmoil and possibly even some political and policy changes.
Iranian law requires new elections within 50 days, or by the end of June, and they come at time of increasing challenges for the regime. The economy has continued to stutter, largely because of mismanagement exacerbated by sanctions. Much of the economy remains under the heel of the Revolutionary Guards, who have consistently blocked needed reforms and are a major political forc behind the scenes. The result has been a sinking rial and an inflation rate over 50%, fueling complaints that are multiplied by unhappiness with the political and social repressiveness of the regime.
On the surface, no significant change is likely in the regime’s anti-U.
