Iranian energy ministers have made the sudden decision to ration gasoline while also raising prices at the pump, sparking rioting and the torching of gasoline stations, report Bloomberg and other news sources.
Drivers waiting in long lines have gotten into fights, while buildings’ windows have been smashed and walls have been blackened by smoke from burning fuel pumps. Iranian state-run radio has blamed the rioting on “opportunistic elements”.
Iran is the worlds’ fourth-largest producer and exporter of oil and holds the world’s second biggest energy reserves, but it imports 40% of its gasoline. Its gasoline producers and sellers are subsidized by the government while its distribution capabilities are hindered by wasteful practices, smuggling, and limited refinery capacity.
Angry motorists in Tehran, the capitol, had to wait in line for several hours on Wednesday just to fill up with one tank of now more expensive gasoline. At least five pump stations have been burned amidst the rioting taking place in the streets of major cities including Tehran, Mashhad, and Arak.
Under the new regulations handed down from the Oil Ministry, most Iranians will be limited to 21 gallons, or 100 liters, of gasoline a month. The ministry additionally stated that the price would be raised by more than 20 percent to $0.11 per liter or $0.44 a gallon. Taxi drivers can buy up to 168 gallons or 800 liters a month and foreign diplomats can purchase 126 gallons or 600 liters a month. Iran says it spends $0.52 per liter to import its gasoline.
Iranian lawmakers have summoned Oil Ministry Spokesman Vaziri-Hamaneh to attend parliament Wednesday to “answer questions” with regards to the rationing, the Iranian Labor News Agency stated.
The current Iranian government of President Mahmoud Amadinejad had come to power vowing to share the nation’s oil wealth more fairly and widely. But drivers today were not feeling his words.
“We are swimming in oil and all they do is just put pressure on people,” said taxi driver Hasan Mohammadi to Reuters.
“I cannot tolerate more economic pressure. My monthly salary is $300. I have three sons,” teacher Hasan Sanjari told Reuters.
“Last night’s riots were an expression of the anger of people with lower incomes,” government employee Saeed Sameti told Reuters. Sameti had queued for five hours.
Iranians in cities have become increasingly and heavily reliant on their automobiles to get around, as there is a dearth of public transportation available in most urban areas.
“Either they are going to offer ((extra fuel)) at a high price or there is going to be black market at a high price,” Hatef Haeri, head of business consultancy ICG, was quoted as saying by Reuters.
Bloomberg, “Iran Rations Gasoline, Sparks Protest in Tehran”
Reuters, “Iran fuel rations spark anger, pump stations burn”
CNN, “Protesters torch Iran gas stations”