Iran's Petrochemical Oligarchs; Families in the Shadow of Rent and Corruption

The privatization of Iran's petrochemical industry, which was supposed to reduce the size of the government, create competition, bring private capital into the industry, and increase efficiency from the mid-2000s, resulted in something else in a large part of this industry. The formation of conglomerates with concentrated ownership, family and political ties, and extensive access to public resources; networks that today some of them have rooted so deeply in Iran's oil, gas, and petrochemical economy that removing a manager or even a family does not necessarily change the structure that created them.

The issue here is not only the well-known families Motahari-Asl and Najafi-Asl. The Rejali, Khamoushi, and groups like the one managed by Mohammad Ali Fatemi are each in different ways examples of concentrated capital and influence around various sectors of the petrochemical industry; although the nature, background, and legal status of each are different and should not be described with a single judgment.

The root of this situation should be sought in the way the privatization of the petrochemical industry was implemented; a policy that accelerated from the 2000s. The National Petrochemical Company gradually transferred ownership of production complexes and transformed from a large producer to a primarily developmental and regulatory entity. However, the transfer of massive assets built with oil revenue, government facilities, public infrastructure, land, pipelines, and cheap feedstock, in some cases, did not lead to a competitive market with thousands of independent investors, but rather to concentrated ownership in limited conglomerates.

One of the most famous examples is Bakhtar Petrochemical Holding. Bakhtar; an example that brought in the parliament and the inspection organization. The names of the Motahari-Asl and Najafi-Asl families have been linked for years with the case of the Bakhtar Holding transfer, the West Ethylene Pipeline, and a series of petrochemical companies.

 In several investigative reports, using company registration information, the Motahari-Asl and Najafi-Asl families have been introduced as owners or shareholders of a large network of petrochemical companies and related industries, and the names of companies like Navid Zarsimi, Amir Kabir, Kavian, Kermanshah Polymer, Lorestan, Mahabad, Kurdistan, Zagros, and subsidiaries of Bakhtar have been mentioned in this network.

In 2020, the parliament approved an investigation into the manner of Bakhtar's privatization. Later, the officials of the investigative committee spoke of irregularities in the privatization, pricing, and violation of public sector rights.

The General Inspection Organization of the country also announced in another case related to Bakhtar's capital increase that legal requirements were not met. The result of the judicial review was the return of 5.5 percent of shares belonging to the government and public institutions; shares whose value was announced to be around 19 trillion tomans in 2023. Therefore, the Bakhtar issue cannot be considered merely an 'accusation on social networks.' The name of Hassan Najafi was also raised in the Akbar Tabari case. Court reports, domestic media, and investigative reports outside Iran have addressed his relations with Tabari and the Lavasan land case. Multiple reports have repeatedly linked the stories of Kalak and Basti Hills to the economic network associated with Najafi-Asl and Motahari-Asl.

Meanwhile, the issue is that the volume of wealth, ownerships, supervisory cases, and political connections surrounding an economic network itself has become a fundamental question about the mechanism of privatization.

The Rejali; from Textile Industry to Rijal Petrochemical

But Bakhtar is not the only example. The Rejali family has also created a large industrial conglomerate over several decades. Ali Mohammad Rejali is recognized as the founder of the Zarif Mosavar Industrial Group and Rijal Petrochemical. Old industrial sources have also introduced him as the CEO of Rijal Petrochemical and Reza Rejali as the commercial director of this group. Sources related to the petrochemical industry have also registered the ownership of Rijal Petrochemical at one point as 100 percent belonging to individuals. The name Rijal later entered a judicial case as well. Voice of America reported in April 2023, quoting the Tehran prosecutor, that an indictment was issued for the managers of Rijal Petrochemical on charges of 'major disruption in the production system'. 

According to the prosecutor's announcement, the case involved the sale of about 128,900 tons of petrochemical materials outside the stock exchange mechanism from 2018 to 2020, valued at over 18 trillion rials at the prices of that period.

The accusation is directed at the managers of the case, and the existence of such a case shows that the issue of concentrated ownership in private petrochemical companies does not end with the initial privatization and that access to feedstock, product sales, and the domestic market is another part of the issue.

The Khamoushi; from the Chamber of Commerce to Petrochemical Trading

Another circle that cannot be overlooked in examining the history of petrochemical privatization is the Khamoushi family. Radio Farda in a report titled 'The Adventures of the Petrochemical Godfather and the Islamic Coalition Party' addressed the role of Alinaqi Khamoushi and the Iran Investment Company. 

According to this report, the Iran Investment Company became the main shareholder of the Petrochemical Trading Company and participated in numerous companies and projects in the petrochemical industry. Radio Farda also mentioned the presence of this network in Takht Jamshid Petrochemical, Pardis, and Iranian Investments and a series of subsidiary companies.  The Petrochemical Trading Company had special importance; because it was once one of the most important channels for selling and transferring foreign exchange of Iranian petrochemical products.

55 percent of this company's shares were transferred to the Iran Investment Company in 2009. Later, the famous corruption case of the Petrochemical Trading Company was formed, and its long trials became one of the largest economic cases related to the petrochemical industry.

This point does not necessarily mean proving the commission of a crime by all shareholders of the Iran Investment Company or the Khamoushi family. But the PCC example shows how the privatization of a strategic link in the foreign sale of petrochemical products can turn a private company into a player with extensive power in circulating billions of dollars of foreign exchange.

Mohammad Ali Fatemi and the Fateh Sanat Network

In the newer generation of capital owners and contractors in the oil, gas, and petrochemical industries, the name Mohammad Ali Fatemi is also noteworthy. According to industrial company information, Seyed Mohammad Ali Fatemi has managed the 'Fateh Sanat Kimia' group and Navid Zar Shimi; a group active in the design, construction, installation, and repair of oil, gas, and petrochemical industry equipment and logistics services. Industrial sources have registered large factories and hundreds of human resources for this group.

 The name Seyed Mohammad Ali Fatemi is also registered in the company information of Takht Jamshid Petrochemical as a board member. The relations of Fateh Sanat with large petrochemical projects can also be traced. The official public relations channel of Gachsaran Petrochemical reported on the visit of the CEO and officials of this company to Fateh Sanat Kimia to review the construction of project equipment. Other sources have also registered the contracts and collaborations of this group with petrochemical projects.

An Industry Where Families Replaced Institutions

Placing the Motahari-Asl, Najafi, Rejali, Khamoushi, and other economic networks alongside each other does not necessarily mean that all of them have committed the same type of corruption. The more important common point is elsewhere, an industry that was once largely publicly owned, after privatization, became an environment where in parts of it, family and network ownership became very powerful based on rent and corruption.

 In competitive economies, there are also billionaire families and family companies. The difference is that their wealth should have been formed in a market where the rules are the same for everyone. In Iran, however, petrochemical feedstock, foreign exchange, land, bank credit, water, electricity, gas, docks, pipelines, and even the export market are heavily influenced by government and institutional decisions. In such an economy, access to the decision-maker can be as valuable as industrial capability.

Anyone who can buy a complex cheaper, receive larger facilities, have guaranteed feedstock, transfer export foreign exchange through a specific route, or place managers close to them in the company's structure gains an advantage that an ordinary entrepreneur cannot compete with. This is the point where privatization can turn into 'crony capitalism' instead of a 'private economy'.

Sanctions; The Second Stage of Oligarchy Formation

Sanctions also complicated this structure. When the sale of oil and petrochemicals, receiving money, and transferring foreign exchange exited the official banking network, intermediaries and trustee companies gained unprecedented importance. In August 2026, the Court of Audit reported on the performance review of 140 trustee companies active in transferring oil revenues and warned about heavy commissions, resource sedimentation, and intermediary profits.

 That is, privatization and sanctions together created two different stages of a process, first the transfer of part of public assets to limited groups and then the creation of opaque networks for product sales and money transfer.

An Error Whose Effects Last for Generations

The question that should be asked today is not when Gholamhossein Motahari-Asl, Najafi Asl, the Rejali family, the Khamoushi, or Fatemi will step down from the economic scene. Of course, individuals come and go. The real question is when will the structure that allows the formation of such empires change?

If the privatization of petrochemicals in the 2000s and thereafter had been conducted under real supervision by the parliament, free media, an independent judiciary, and a transparent system of disclosing the ultimate beneficiaries of companies, would the ownership of this industry be so concentrated in limited economic and quasi-family circles today? 

If all feedstock contracts, bank facilities, share transfers, transactions of affiliated companies, and the real beneficiaries of private companies were accessible to the public, would cases like Bakhtar wander between the parliament, inspection organization, and court for years?

The mistake of the 2000s was not just selling a few factories. What was transferred were factories built with the oil, land, water, gas, foreign exchange, and capital of the Iranian people. And what was formed alongside these factories in some cases was not just a new capitalist class; it was a network of wealth, management, politics, banking, trade, and influence.

The oil and petrochemical oligarchy may pose a threat to Iran's future no less than many external threats. A country whose natural resources are distributed in closed circles, where competition is replaced by access, and where supervisory institutions only enter the field years later to reclaim part of the public assets, is worn out from within before being damaged from outside. The biggest lesson from Iran's petrochemical privatization may be this: corruption does not always start with a suitcase of money.

Sometimes it starts with a privatization; a pricing, a bank facility, a preferential share, a feedstock contract, an appointment, and a turning a blind eye by the oversight body. After twenty years, we are no longer facing a corruption case; we are facing a class of corrupt political and economic power holders who themselves reside in Europe and America but have bottled the blood of the people in Iran.