Iran mulling to increase fuel prices to stop mass smuggling

Iran is mulling to increase the prices of motor fuels in the calendar year starting late March, a report shows, amid efforts to stop mass smuggling of fuels out of the country and to cut the government’s import bill.

News ID: 5535

Date: 04 December 2024 - 08:48

TABNAK, Dec 04 : The remarks made by Iranian President Masoud Pezeshkian in a TV interview and made it clear that the government is determined to increase fuel prices.

It said Iran’s finance minister Abdolnasser Hemmati had also said in a speech on Tuesday that the government will have no option but to increase the price of gasoline.

“No logic accepts that we have such an awful level of gasoline smuggling and then be forced to import gasoline at the same time,” the agency quoted Hemmati as saying.

It said that Iran will have to spend nearly $6 billion on gasoline imports in the next calendar year if it keeps prices at the current level.

The report said that a viable scenario for a gasoline price hike would be for the government to have a quota system of allocating up to 160 liters per month of gasoline to car owners at heavily subsidized prices and then charge international prices for extra consumption.

Iran has the cheapest fuel prices in the world. The price of octane-95 gasoline is 15,000 Iranian rials ($0.021) per liter for a monthly quota of 60 liters while motorists can fill up their tanks at double that price for almost unlimited amounts.

In a decision announced last month, the government authorized the unsubsidized imports and sale of unleaded gasoline as part of efforts to reduce the size of subsidies given to motorists.

Iranian parliament speaker said last month that some 25-30 million liters of fuels, including gasoline and diesel, are being smuggled from Iran every day.