US sanctions hit Iran's airlines from today: Mahan Air drops regional routes

A new round of US sanctions on Iran took effect on Wednesday 23 September, and the immediate casualty is Iranian civil aviation. Mahan Air, one of the country's biggest carriers, and the smaller Varesh have suspended a list of regional routes.

US Treasury Secretary Scott Bessent announced the measures on Monday. The enforcement threat he set out is what makes them bite: "If they land, you cannot provide them with fuel, you cannot sell them tickets or you will be knocked out of the dollar system." Airports and ground handlers that are nowhere near American jurisdiction have to choose between servicing an Iranian aircraft and keeping dollar banking.

What has stopped and what is still flying

Suspended, per travel agents in the region: Baghdad, Muscat, Qatar, Georgia and Azerbaijan. Some Istanbul flights have been cancelled while others remain scheduled.

Still operating: Najaf, Dubai, Guangzhou and Shanghai, partial Istanbul service, Turkey and Armenia on smaller carriers, and Kabul to Tehran.

The sanctions follow what the US describes as an attempt to force Iran into submission after nearly seven months of war.

What this means for Pakistani travellers

No Pakistan route is named in the cancellations so far. The exposure for readers here is indirect, and it is worth understanding before you book.

Pakistani zaireen travelling to Iran and on to Iraq have two ways in: the overland crossing at Taftan in Balochistan, and connecting flights. Nothing announced so far closes Taftan, and Najaf is still being served. But the Baghdad suspension matters for anyone who planned to fly the Iraq leg, and Iraqi travel agents are already reporting that clients are switching to land routes because of the cancellation risk.

The practical advice from agents in the region is the useful part. One told reporters: "The situation is unstable and we are no longer selling tickets for the time being for fear of cancellations."

If you have an itinerary through Tehran, Mashhad or Baghdad in the next few weeks:

• Do not buy a non-refundable ticket on an Iranian carrier right now.
• Check whether your travel insurance excludes sanctions-related cancellation, because most policies do.
• Confirm with your tour operator, in writing, who bears the cost if a leg is cancelled.
• If you are already ticketed, get the operator's fallback in writing before you travel, not after.

The dollar is the weapon

The mechanism here is worth noting for anyone who follows Pakistan's own economy. These sanctions do not ban flights. They make it commercially impossible to service the aircraft by threatening third parties with exclusion from dollar clearing. That is the same lever that shapes how Pakistani banks handle correspondent relationships and why a compliance department in Karachi will refuse a transaction no Pakistani law prohibits.

The rupee closed at Rs 277.20 to the dollar on Wednesday. You can convert any amount at the current rate with our currency converter.