Iran should narrow expenditure, cash subsidies amid falling oil prices
Tehran, Iran, Jan. 13
By Mehdi Sepahvand - Trend:
The Iranian government has two ways to meet the falling oil prices - narrow expenditure and reduce cash subsidies, Iranian MP Ebrahim Neku said.
OPEC oil basket price plunged to $25.76 on Jan. 12, about $1.31 less than the previous day.
As Iran's economy is heavily reliant on oil, in such situations the government needs to seek other sources of income, Neku told Trend January 13.
OPEC oil basket price was about $108 in first half of 2014, but has been decreasing due to glut in the markets. The current figure is the lowest price since early 2014.
Iran's case has been especially bad under international sanctions, which forced the country to cut its output from over two million barrels a day to one million.
The MP stated that the Iranian government has to have the least expenditure to save money for vital corners.
He added that cash subsidies are overwhelming the country's economy at large and need to be narrowed down to only really needy people.
The cash subsidies were initiated by former president Mahmoud Ahmadinejad by giving each Iranian what is now worth $12 per month.