The Iranian rial, after plunging 18% in just three days, hit an all-time low against the US dollar this week [Sept. 10]. But despite conventional wisdom, there are other factors behind this sudden drop besides the growing impact of U.S.-led sanctions on Iran.

Although Western-led sanctions have made Iran’s nuclear drive increasingly costly, the rial plunge may also be the firing shot of a broad effort by the Mahmoud Ahmadinejad administration to use the punitive measures as a cover to gain control over more sectors of the Iranian economy. This move may go hand in hand with a wider effort to deflect blame for the country’s economic malaise. The rial drop came only days after the Iranian president acknowledged the adverse effects of the sanctions on live TV after having largely denied such effects for years.

In analyzing Iran’s currency gyrations, four facts about the Iranian government’s finances should be kept in mind:

First, Iran’s economy is relatively diversified. Oil exports only accounted for 21% of Iran’s GDP last year compared with 30% to 50% among most Arab Persian Gulf states.