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Rationing, higher prices save Iran $22 billion

Iran Materials 5 March 2012 17:48 (UTC +04:00)

Azerbaijan, Baku, March 5 / Trend M. Moezzi

Since the Iranian government started its petrol rationing program a little more than four and a half years ago, it has saved $22 billion, the Iranian Students' News Agency (ISNA) reports.
If the rationing program hadn't been implemented and prices hadn't increased, Iranians' daily petrol consumption would have reached 120 million liters a day instead of the current 55 to 55 million liters, said Mohsen Rohani, the manager of the new electronic fuel system.
Low fuel prices in Iran encouraged their being smuggled to neighboring countries, Rohani said.
In earlier comments, Economic and Financial Affairs Minister Seyed Shamseddin Hosseini contended that Iran's petrol imports were $5.6 billion in 2009/2010, a figure that would have increase to $8 billion this year.
The petrol rationing program began in the summer of 2007 with drivers being allocated 120 liters a month. The monthly allowance has been reduced over the last 55 months to 60 liters.
Meanwhile, the Iranian government's program to end subsidies has pushed up petrol prices from 1,000 rials to 4,000 rials a liter. The price for petrol on the free market is 7,000 rials while super petrol costs 8,000 rials.
The Iranian government pays each citizen $45 a month as compensation for eliminating commodities' and energy subsidies. Cutting out the energy subsidies was expected to drive down Iranians' energy consumption and free up money the government used on the subsidies.

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