Iran General NewsIran hopes to start petrol rationing in two weeks

Iran hopes to start petrol rationing in two weeks

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AFP: Iran hopes to begin a much-delayed plan to ration petrol in the next two weeks amid continued uncertainty over its launch date, officials said on Wednesday. TEHRAN, June 6, 2007 (AFP) – Iran hopes to begin a much-delayed plan to ration petrol in the next two weeks amid continued uncertainty over its launch date, officials said on Wednesday.

The plan, aimed at reducing colossal subsidies paid by the state to finance oil-rich Iran’s frenzied petrol consumption, envisages forcing consumers to pay a much higher price for any purchases in excess of a rationed quota.

“I hope that the rationing plan will be able to start at the latest by June 21,” Mohammad Nasseri, the spokesman for the plan, told the ISNA student news agency.

Iran implemented the first stage of the plan on May 22 by raising pump prices by 25 percent and making consumers use smart cards to keep track of their petrol purchases.

But there remains considerable confusion over when and how the rationing will be implemented in OPEC member Iran, the world’s fourth largest oil producer.

The government has still shown no sign of announcing the size of the quota or how much petrol purchases in excess of this amount will cost.

Members of parliament’s energy commission which drafted the law have said the rationing plan should be scrapped entirely as use of the cards was effectively controlling smuggling and consumption.

“Since smart cards have been used, petrol consumption and smuggling have dropped and there seems to be no need for rationing,” Hossein Afarideh, a member of energy commission told ISNA.

Interior Minister Mostafa Pour Mohammadi said rationing would be implemented “gradually and progressively”, adding there was there was still a “technical debate” over which cars and social groups would be targeted first.

According to the law passed by parliament, the rationing was meant to come into force on May 22, along with the price rises, but was then put off indefinitely.

Iran’s cheap pump prices have also encouraged such consumption that the major oil producer ironically has to spend billions of dollars each year on importing refined oil from abroad.

Another problem stems from smugglers who illegally take cheap petrol bought in Iran out of the country to neighbouring states where pump prices are far higher.

There is a consensus in Iran the burdens on the budget created by the subsidies cannot continue but the government is also aware that Iranians have become very used over the years to unlimited cheap petrol.

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