The Iranian team started its campaign at the tournament with a 2-0 loss to North Korea in Group B and then conceded a 3-1 defeat to Algeria, Tasnim News Agency reported.
Having garnered only one point from three matches, the Iranian squad failed to reach the next round and finished in the fourth place in its group.
Algeria and Germany advanced to the next stage with nine and four points, respectively.
North Korea finished in third place with three points.
The second-division team Fajr Sepasi represented Iran in the competition.
Sixteen teams have taken part in the meet which is currently underway in Muscat, Oman.
The tourney's quarterfinals and semifinals will be played on January 24 and 26, respectively.
The third place playoff and the final will be held on January 28.