Iran not to raise price of energy carriers - PBO

Oil&Gas Materials 26 October 2021 15:26 (UTC +04:00)
Iran not to raise price of energy carriers - PBO

TEHRAN, Iran, Oct. 26


The head of the Planning and Budget Organization of Iran announced that the price of energy carriers is supposed not to be increased in the next Iranian year's budget bill (starts on March 21, 2022), Trend reports citing IRNA.

Massoud Mirkazemi made remarks on the sidelines of the first meeting of the deputy ministers for parliamentary affairs, today on Monday.

Referring to studies in the past few years, he says that the country consumed a lot of resources, but at the same time, the household income reduced, the economy shrank, the inflation rate increased to 22.5 percent, and the investment declined to 4.6 percent.

Iran's government, as the sole supplier, sets the prices of energy carriers. The government has historically set prices low. Cheap energy prices stipulated by the government as part of its policy agenda to protect and serve the poor constituents an indirect subsidy for energy carriers efforts over the past decade to improve pricing policy via Price Reform Policies have only slightly improved prices in real terms and have not succeeded in limiting demand.

These subsidized low prices result in the irrational, over-consumption of energy which is reflected in the high energy intensity indicator compared to other countries and a sub-optimal energy mix.

Based on data from the International Energy Agency, Iran paid $29.7 billion in energy subsidies last year to rank first globally, leaving behind China with $25.5 billion, India with $23.7 billion, and Saudi Arabia with $10.9 billion.