March 8, 2007


Iran's motorists face petrol rationing (Daily Times, 3/08/07)

Millions of Iranian motorists face the prospect of higher fuel prices and rationing after parliament voted on Wednesday to ration cheap petrol in a bid to cut costly state subsidies. [...]

Iran currently has to import 30 million litres of refined oil a day, at great cost to the budget, to meet demand. The budget for the past Iranian year - which ends on March 20 - has set aside a colossal 4.7 billion dollars to pay for petrol imports.

The problem of hungry consumption is compounded by Iran's refineries having a capacity of only 42 million litres of petrol a day in a country where demand stands at more than 70 million litres daily.

In addition, Iran loses millions of litres of petrol a month thanks to smugglers who sneak the gasoline out of the country and seek to sell it for far higher prices in neighbouring Iraq, Turkey and Pakistan.

The need for Iranians to cut down on driving is most apparent in Tehran, where the horrendous air pollution from the thousands of cars snarled up in traffic jams at any time has made just living in the city a health hazard.

However with the public transport infrastructure relatively weak and the metro system only reaching certain parts of the city, the car is for many Tehranis the only way to get around.

Such misery is truly too terrible to contemplate.

Posted by Orrin Judd at March 8, 2007 11:18 AM

So the more oil prices go up, the more they have to pay to import it?

Posted by: KRS at March 8, 2007 12:42 PM

Right. Then they sell it at a below-market price, and lose money that way. They should just ditch the subsidy and the rationing, but the populace wouldn't take kindly to gas prices jumping by a factor of 5 or 10.

Posted by: PapayaSF at March 8, 2007 3:05 PM

These are the people we are supposed to be afraid of, engineeering an ice shortage in Alaska. Oh spare me.

Posted by: Lou Gots at March 8, 2007 6:13 PM

KRS, technically it's the more the price of oil goes up, the more they must pay to import gasoline.

Iran lacks the refineries to process its own oil.

Posted by: Chris Durnell at March 8, 2007 6:28 PM

Can't they organize caravans to move goods and people. Very environmentally friendly.

Posted by: erp at March 9, 2007 11:50 AM