Three scenarios for the dollar: Hormuz, stalemate, or talks?

The US dollar trades in the 188,000 toman channel on Iran's free market today. A year ago it was 93,000 — it has doubled in twelve months.

One thing has to be cleared up at the outset, because it changes the whole question: the war that began on 28 February is not over. Today is day 159. What became known as the "40-day war" was only its first phase, 28 February to 8 April. Two ceasefires followed — April, and the Islamabad Memorandum in June — and both collapsed; the second on 8 July, with strikes on 80+ targets and the naval blockade reimposed on 14 July.

To answer it we went to our own archive rather than guessing: 1,403 records from November 2012 to today, covering every trading day of this war.

1. The engine that never switches off

Before the politics, one plain economic fact. Look at the dollar's annualised return:

Window	Annualised rise
Last 10 years	48.6%
Last 5 years	48.9%
Last 3 years	56.2%
Last 12 months	102.1%

The ten-year and five-year figures are locked at roughly 49% a year. That is no coincidence. When liquidity grows 53% a year and the monetary base 61.5% while output does not, the currency loses value at about that pace. War and peace do not switch this engine off; they only move the foot between accelerator and brake.

2. What each political condition has actually cost

Every row is a distinct political period, and the last column is the annualised rise during it:

Period	Condition	Annualised
Nov 2013 – Jul 2015	Geneva talks to the JCPOA	4.9%
Jan 2016 – May 2018	JCPOA in force	26.9%
May – Sep 2018	US withdrawal (4.5 months)	+196% total
Apr 2021 – Mar 2022	Vienna talks	2.7%
Mar 2022 – Jun 2025	No war, no deal	43.6%
Sep 2025 – today	Sanctions return	86.4%

Two conclusions matter.

The psychology of talking. In both negotiating periods the annual rise was held under 5%, against a long-run average of 49%. Simply sitting at the table — with nothing signed — cut the pace by roughly 90%.

The reality of a signed deal. The JCPOA did not make the dollar cheaper. While it was in force the dollar rose 27% a year. A political agreement does not pull the price down; it stops it running.

3. The market reacts to the pipeline, not to missiles

This is the heart of the analysis — and this year gave it the best test in its history.

Recall the twelve-day war of June 2025. The market was effectively shut: our archive has no record at all between 11 and 24 June — a genuine hole in the data. When it reopened:

• Night before the fighting: 83,535 toman
• Ceasefire day: 82,870 — cheaper than before the war
• Post-ceasefire peak (30 June): 91,720, about 10% higher
• Two weeks later: back to the 87,000 channel

The largest military confrontation the region had seen in decades added ten percent, half of which unwound.

And now the second test: the 2026 war

The pattern repeated, harder. From 28 February to 14 March the published quote did not move: thirteen prints, all between 166,330 and 166,370 — a range of 40 toman, 0.024%. Gold, the coin and the dirham froze in exactly the same way.

This was not our pipeline failing. Global gold in dollars printed new values throughout, including on the Fridays when the Iranian series has no reading at all. Every domestically-set price froze; everything with a foreign leg carried on.

Then quoting resumed, and the price did not gap up. It gapped down:

	14 Mar (frozen)	16 Mar	Change
US dollar	166,360	143,700	−13.6%
Emami coin	209,010,000	174,500,000	−16.5%
18-carat gold	20,122,300	16,923,000	−15.9%

One necessary honesty: a frozen quote is not a closed market. Our data shows the published price did not change for fifteen days; it cannot tell you whether traders had stopped or whether the source was repeating its last number. So we put it no more strongly than this: the quote was frozen for fifteen days, and when it moved it was much lower.

So what did move the price?

Window	Move	Coincident event
22–28 Jan	+13.7%	Pre-war build-up
28 Feb	pinned at 166,360	War opens
15–16 Mar	−13.6%	Quoting resumes
7–8 Apr	−3.8%	First ceasefire
13–18 Apr	−7.2%	Blockade begins — and the toman strengthened
27 Apr – 3 May	+17.3%	Biggest move of the year, just before exports collapsed
12–16 Jun	−15.2%	Ceasefire and the Islamabad Memorandum
7–8 Jul	+2.4%	Memorandum collapses; 80+ targets struck
13–18 Jul	+7.7%	Blockade reimposed. Year's high

The missiles are not in this table. The war opened and the price fell. Eighty targets in one night: 2.4%.

The pipeline is everything. All three of the year's biggest moves are about one thing: whether Iran can sell oil and get paid.

And the sharpest detail: Iranian oil exports fell to roughly 209,000–260,000 barrels a day in May — the lowest since 2019, against about 1.8 million before the war. Yet that collapse did not produce the year's biggest fall in the toman; the market had already moved, 17.3% in five sessions, before the trough printed.

4. Scenario one: escalation in Hormuz

Two cases must be separated, because the market treats them very differently.

(a) Military tension without an export cut. Tanker seizures, limited exchanges of fire, exercises, threats. The June 2025 pattern repeats: an emotional jump, then a retracement. While oil ships and money returns, the engine runs at its usual speed.

• 3 months: 209,000–216,000 toman
• 12 months: 292,000–329,000 toman

(b) Serious disruption to exports. Effective closure of the strait, or anything halting oil sales for months. This is not a simple political risk — it is currency asphyxiation. The strait is already mined, and the Pentagon estimated in April that clearing could take about six months.

The analogue is 2018: with revenue cut off, the dollar rose 196% in four and a half months.

• 3 months: 235,000–273,000 toman
• 12 months: 395,000–602,000 toman, higher still if panic sets in

Case (b) is extremely costly for Iran too, which lowers its probability — but "costly" has never meant "impossible".

5. Scenario two: the status quo grinds on

The most likely and most attritional path: nothing is resolved and no new shock changes everything. The blockade stays, exports stay throttled, the monetary engine runs.

In the comparable period (March 2022 – June 2025) the dollar rose 43.6% a year. Two things differ now: sanctions are back, and the pace since September 2025 has been 86.4%. Since the Iranian new year it has run at 54.2%. Something between the two is realistic:

• 3 months: 209,000–216,000 toman
• 6 months: 230,000–260,000 toman
• 12 months: 292,000–329,000 toman

This is not calm. It is a silent 55–75% annual erosion that simply does not make headlines.

6. Scenario three: back to the table

Here the data is clearest. Three times in three years the market has reacted hard to a diplomatic signal:

When	Path	Fall
Mar 2023	58,493 → 46,792	20% in two weeks
Apr 2025	105,555 → 80,835	23% in two weeks
Jun 2026	181,390 → 153,500	15% in one month

Three different events, one consistent result: a 15–23% discount within two weeks to a month. That is the peace premium in this market, and it has repeated with remarkable stability.

And there is a draft on the table: a Hormuz agreement with an initial 60 days, no transit tolls, inbound through a northern lane and outbound through a southern one, and mine clearance within 30 days. It is still a draft; no signature is confirmed.

If it is signed:

• Initial reaction (2–6 weeks): 154,000–169,000 toman
• 12 months: 192,000–226,000 toman

7. The market's real thermometers

Instead of following war headlines, watch these five.

Worth pausing on: although the rate is near an all-time high, most alarms are not red. Dirham arbitrage is closed at 0.7% and the coin bubble is small. This is not the picture of a panic; it is a steady monetary grind with a war on top. The one gauge that has moved is Tether.

Want to work out today's bubble yourself?

8. An honest word of warning

The numbers above are not firm forecasts; they are ranges based on how this same market behaved in comparable conditions.

And let us be plain about what we do not know: the war has no end date; July and August export volumes have not been published by any source; nobody knows how many mines were laid or cleared; and whether the market was formally closed in March, or merely stopped producing a new quote, cannot be determined from price data alone.

Iran's currency market can be turned over by things that appear in no table: a sudden domestic decision, a budget shock, a change in central bank policy. The further out the horizon, the wider the range.

This is not a signal or investment advice. We record and analyse rates; we do not tell anyone what to buy or sell.

If one sentence stays with you, let it be this: over a twelve-month horizon the dollar's direction is set by money supply growth, and its timing by whether Iran can sell oil and be paid for it. In 2026 missiles moved the price by single digits; blockades and memoranda moved it by fifteen.

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Rates in this article are the free-market sell price recorded by Dolarchand. The full archive, with weekly export, is on the price archive page.