Analysis: Iran president rebuffed

BBC News, Tehran

Parliament's failure to endorse President Mahmoud Ahmadinejad's third nominee for the post oil minister has come as a shock in Iran.

The situation is so unusual that one member of the parliament's presiding board has now said they should refer the issue to the body which vets legislation - known as the Guardian Council - for guidance about how to proceed.

The third nominee Mohsen Tasalloti received only 77 votes in parliament, with 139 against him.

It appears some of those who supported his nomination belonged to the minority reformist group in parliament, meaning that some of the president's own supporters voted against his choice.

When Mr Ahmadinejad won the presidential elections the assumption was ultra conservatives now dominated all the organs of power in Iran - the parliament and the government.

After years of factional politics many Iranians thought there would be a more homogenous power structure.

That has proved wrong - Mr Ahmadinejad is still struggling to assert his control after several months.

Veiled attack

Iran's Supreme Leader Ayatollah Ali Khamenei, with whom ultimate authority rests, has already taken the unusual step of warning people to give more time to the new president to fulfil his agenda.

He reminded Iranians that the president was democratically elected and said it was not fair to criticise him.

But the president's rival, Akbar Hashemi Rafsanjani, has launched a veiled attack on Mr Ahmadinejad, complaining about a series of purges of officials.
At the foreign ministry, it has been announced that 40 diplomats including many key ambassadors are to return to Iran in the coming months.

The ministry of culture spoke of the need to remove officials who had not done enough to protect Islamic values.

And the president removed the heads of all seven of Iran's state banks.

Some have argued that a change of government naturally leads to officials changing, but the concern is whether there is too much upheaval too fast and whether there are experienced people to take these posts.

Paralysis

For the oil ministry which has now had no minister for three months, there is concern about the impact on investment.

Oil prices are high so there is no problem about payments, but it is the effect on decision-making that is worrying.

"As a result the activities of the ministry and some of its affiliated companies are more or less at a standstill which is dangerous," says economist Dr Ali Rashidi.

Already the former chairman of the Tehran stock exchange says that the bourse has lost 25% of its value since Mr Ahmadinejad came to power - the largest drop in the history of the exchange.

It is seen as an index of economic uncertainty - internally about the president's new policies and externally about the outcome of the nuclear dispute.