Solid energy prices in Iran until March 2016

Solid energy prices in Iran until March 2016

By Dalga Khatinoglu

Iranian government undertakes about $80 billion energy subsidy annually, more than the country's total exports.

However, the figures on Iran next fiscal year's budget, which will begin on March 2015, indicate almost no change in energy prices compared to the current level.

The Iranian government has increased the energy carriers prices twice since 2010 based on implementation of a Subsidy Reform plan, but cheap energy still motivates people to consume more energy.

Energy carrier

USD current exchange rate: 35,400 rials

Global prices (NYMEX-2014/2015)

Consumption Per day

A cm of gas

2.8 cent

11 to 16 cent

500 to 520 mcm

A liter of gasoline

28.6 cent

57 to 75 cent

67 million liter

A liter of LPG

6.26 cent

21 to 37 cent

5,500 tons

A liter of diesel

13.43 cent

67 to 78 cent

100 to 105 million liters

A liter of Kerosene

4.47 cent

48 to 64 cent

8 million liters

A cm of CNG

16.53 cent

27 cent

18 mcm

Electricity KWh

1.3 cent

16.37 cent

200 terawatt hours

Iranian Oil Minister Bijan Namdar Zanganeh said on June 24 that currently over $90 billon worth of fuels are being consumed in Iran, while the government pays $80 billion of the mentioned figure as subsides.

The mentioned huge energy costs for a country with a $366.2 billion worth GDP is very high.

coming to the country's power sector, the situation is even worse than other sectors.

Thermal power plants share about 85 percent in the country's 263 billion KWh-electricity production. Iran exported about $800 million worth of electricity during the last year, while the domestic consumption was 203 billion KWh. Iranian government's incomes from this volume was about $3 billion. In the other world, Iran's total power consumption and exports revenues was less than $4 billion, while the country used 36 billion cubic meters of gas, as well as 28 billion liters of liquid fuels (diesel and fuel oil) to produce 263 billion Kwh electricity.

The cost of used fuels in power sector during last year is estimated to be around $45 billion.

On the other hand the efficiency of Iran's thermal power plants is about 37 percent, causes huge amount of lost in converting fossil energy carriers to the electricity.

It seems Iranian government which recently came out from stagnation and high inflation, doest intend to increase energy prices until near future.

Iran's GDP growth reached 4 percent during the first half of current fiscal year, after a 8.7-percent contraction during last two years. On the other hand, the inflation rate has decreased from above 36 percent to below 18 percent since mid-2013.

the situation mentioned above is only whose which are related to final energy consumption, but Iran has a huge amount of energy lost.

The country's primary energy usage is about 1.4 billion barrels of oil equivalent (OE) per annum, of which about 25 percent is lost before reaching consumers. Annually about 400 billion barrels of OE is waste in the country.

On the other hand, Iran's national currency has dropped in value by 3.5 times since 2010.

Each US dollar was sold about 10,000 rials in open market in late 2010, but currently is sold at 35,400 rials. Then dropping the currency's national currency in value has filled the gap between energy prices in 2010 and 2014.

Iranian government also undertook depositing about $13 to each Iranian citizens bank account monthly as a compensation for rising fuel prices, which costs $14 billion based on official USD rate ((Each USD: 28,500 rials).

Dalga Khatinoglu is an expert on Iran's energy sector, head of Trend Agency's Iran news service
Follow him on @dalgakhatinoglu

UK records another 2,144 coronavirus cases, 27 deaths
UK records another 2,144 coronavirus cases, 27 deaths
Turkish president, German chancellor discuss bilateral ties, regional issues
Turkish president, German chancellor discuss bilateral ties, regional issues
Austria interested in participating in projects in Turkmenistan
Austria interested in participating in projects in Turkmenistan
Loading Bars
Qatar reports 645 new COVID-19 cases, 208,877 in total
Central Bank of Iran shares data on impact of oil exports on economic performance
UK records another 2,144 coronavirus cases, 27 deaths
Turkish president, German chancellor discuss bilateral ties, regional issues
OSCE Minsk Group Co-Chairs welcome release of Armenian detainees
Ombudsman prepares report on hate crimes, hostile approach towards Azerbaijanis
Egypt will bring a royal mummy to Expo 2020 in Dubai
Uzbekistan’s 1Q2021 vegetable production revealed
Uzbekistan notes threefold increase in balance of mortgage loans repayment
Georgia sees increase in imports of buckwheat in 1Q2021
Review of regulations to improve Iran home appliances production - official
President Sadyr Zhaparov signs decree on Cabinet of Ministers of Kyrgyzstan
Austria interested in participating in projects in Turkmenistan
Azerbaijani, Georgian peoples live in peace and friendship - PM
Azerbaijan approves renewed make-up of joint commissions with several countries
Azerbaijan to hold webinar on "New Opportunities for Startup"
Azerbaijan discloses data on construction work carried out by private enterprises in Baku
Russian, Turkish presidents discuss issues related to Karabakh
Iran’s Bahar Azadi gold coin price falls
Azerbaijani Finance Ministry places medium-term bonds on auction
Iran's Energy Exchange announces products to be on sale on May 8
Azerbaijan has very responsible approach to ensuring cybersecurity - Kaspersky Lab
Georgian organic farm begins production of sunflower oil
Iran approves projects on establishment of trade zones
Azerbaijani minister names amount of government spending to restore Karabakh in 2021
Canada reveals volume of bilateral trade with Georgia
Georgian Minister of Agriculture talks success of German businesses
Hungarian airline Wizz Air to resume flights from Georgia's Kutaisi International Airport
European Parliament acting unfairly by calling Armenian terrorists "POWs" - MP
Eurostat names amount of petroleum oils imports by EU countries from Turkmenistan
Activities of trade markets between Iran, Pakistan to contribute to trade –Deputy Minister
Kazakhstan investing in Georgian ports, specifically in Batumi oil terminal
Georgia expects increase in low-cost airlines during summer season
Georgia NCC and NATO-EU Information Center to implement joint projects
Iraq commits to return Iran's debts
US welcomes Azerbaijan’s release of three Armenian detainees
Iran's TEDPIX index sees gains
Volume of raw silk cocoon to be produced in Iran revealed
Shameful monument to fascist Nzhdeh in Karabakh must be demolished - Russian media outlet
Shekel weakens after Yellen rate remarks
Flydubai expands network to over 80 destinations, resumes flights to Russia and Iran
Azerbaijan wraps up investigation on Lebanese mercenary who fought in Karabakh on Armenian side
Blue Origin to begin space tourism ticket sales Wednesday
Navoi Mining and Metallurgical Combine leads among Uzbekistan’s taxpayers
Meeting between Azerbaijani, Georgian foreign ministers being held
Azerbaijan shares data on number of vaccinated citizens for May 5
Relations between peoples of Azerbaijan, Georgia based on long history - President Aliyev
Azerbaijan confirms 1,080 more COVID-19 cases, 2,074 recoveries
Georgian, Azerbaijani people are interlinked, interdependent on each other - Georgian PM
UAE to launch flights to Uzbekistan’s Tashkent
Austrian chancellor urges European drug regulator to fast-track Sputnik V’s registration
Azerbaijan continues to be one of biggest investors in Georgia’s economy - President Aliyev
Georgia's prime minister visits grave of Azerbaijan's National Leader Heydar Aliyev (PHOTO)
Azerbaijani IT company to locally launch smartphone app for accepting non-cash payments
Iran's NISOC ready to increase oil extraction
Silk production campaign underway in Turkmenistan’s Dashoguz region
Azerbaijan's PulPal payment system to add cryptocurrency wallet
Geostat unveils statistics on Georgia's oil imports
Azerbaijan reveals funds to be allocated for student tuition
Uzbekistan, S. Korea preparing for buyout of state share of mining and processing JV
Uzbekistan’s textile export to grow in 2021 - German expert
IMF predicts higher oil prices and better COVID-19 response for Iran by second half of 2021
Georgian parliament adopts new law regarding National Bank of Georgia
Georgia to face double-digit inflation if lari continues to plunge in value - TBC-Bank
Turkey reveals 4M2021 data on chemicals exports
Germany, France, Spain reach general agreement over fighter jet
Average monthly salary in Baku down
Turkey's export value of clothes up in 4M2021
Significant amount of funds to be invested in Georgian Poti port dev't - Deputy minister
Russia reports nearly 8,000 daily COVID-19 cases
Electra Consumer Products signs Yeinot Bitan acquisition deal
SOCAR Turkey subsidiaries awarded zero waste certificates
Increasing manufacturing of household appliances in Iran can guarantee exports - ICCIMA
Cost of chargeable services rendered to Baku's population in 1Q2021 dips
Georgia sees increase in potato imports
Georgian PM invites Azerbaijani president to Georgia
1Q2021 turnover of catering sector in Baku disclosed
Baku Stock Exchange holds auction on placement of CBA's short-term notes
Georgia reveals prices of fuel for May 4
Iran hopes Gorgan-Aktau flight to boost its tourism industry
Azerbaijani payment system offers B2B and C2B services in domestic market
Saudi Arabia considers barring overseas haj pilgrims for second year
Khazar Consortium in Turkmenistan opens tender to purchase of hygienic products
SOCAR Turkey’s petrochemical unit increases recycling by over 30%
Details of Iran’s face mask trade disclosed
Iran reveals COVID-19 data for May 5
Uzbekistan, Turkmenistan, Iran talk pilot train transportation
Most transactions on government securities in Azerbaijan fall on primary market
Azerbaijan, Turkey, Uzbekistan plan to ink MoU on audit sphere
Czech sees opportunities for co-op with Uzbekistan in industry and agriculture – Ministry
Turkmen Health Ministry extends tender for medical supplies purchase
Iran sees reduction in reliance on oil exports - Iranian president
Iran's Golestan Province to work on more agricultural projects
Iran expects sanctions to be lifted soon - President Rouhani
Azerbaijan seeks to expand its capabilities in mechanical engineering - expert
Azerbaijani president receives Georgian PM (PHOTO/VIDEO)
Georgia, US highlight importance of COVID-19 vaccination
Turkey sends batch of new engineering machinery, equipment to Azerbaijan (PHOTO/VIDEO)
Twitter, Google, Facebook facing new fines for refusing to remove banned content
Global demand for air transport grows in March 2021
All news