Two days ago, the head of Iran’s Expediency Council invited the United States for direct talks with Iran at any level. The Ahmadinejad Administration has not commented on ayatollah Rafsanjani’s remarks yet and the U.S. government has not accepted the offer either. Despite Rafsanjani’s remarks, there is increasing pressure on the Iranian economy, particularly in the oil and gas industries.

Reports indicate that U.N. backed sanctions and efforts by the United States to isolate Iran have put an end to the bright era of international cooperation in rebuilding the country’s industrial infrastructure.

As major international banks continue to suspend their financial relations with Iran and as the country’s oil and gas customers are abandoning it one by one, it is becoming much harder, if not impossible, to hide the effects of sanctions. Last month, in a complaint filed with the International Civil Aviation Organization, the Iranian government implicitly admitted to something it was previously hiding: American sanctions on the sale of civil aviation spare parts to Iran have endangered the lives of thousands of civilians in Iran.

The same is true of Iran’s oil and gas industries. Government officials, even the former Minister of Oil who resigned from his post this week, have announced time and again that sanctions have not affected the country in any way. Nevertheless, several lawmakers from the country’s southern provinces have announced that major projects have been cancelled and scores added to the country’s army of unemployed. From the fifty thousand people employed in the Assuluyeh special economic zone during former president Khatami’s final years in office, only 28 thousand remain in the area.

Meanwhile, the Ahmadinejad administration continues to spend a bulk of its development funds on supporting small industries that are expected to produce immediate returns. Though such a measure may produce short-term employment, it fails to result in long-term macroeconomic growth and puts pressure on inflation, as economic experts forecast.

According to experts and analysts, the country’s oil infrastructure resembles security and military areas these days, as the government has reverted to using subsidiaries associated with the Revolutionary Guards to keep up some of the projects. Developers associated with the Revolutionary Guards have replaced competitors such as PetroPars and Kish Oriental, which were established under former president Hashemi’s tenure and were able to subvert some of the effects of U.S. sanctions.