Renewed controversy over petrol rationing in Iran

Jul 24, 2007, 21:27 GMT

Tehran - the Iranian Parliament on Tuesday again pushed the government to loosen its unpopular petrol rationing scheme to allow people whose livelihoods have been affected to buy extra fuel at higher prices.

Since June 27, Iran has been rationing petrol to 100 litres per month for normal cars, 300 litres for government cars and 800 litres for taxis, with a litre of normal petrol costing 10.8 cents and 15.1 cents for a litre of super petrol.

The decision was based on a parliamentary bill that had also approved that additional quotas at higher or floating rates - around 65 to 95 cents per litre - should be allocated to people whose livelihoods depend on their cars.

The parliament says that the government is obliged to implement the parliamentary bill, but the government wants to maintain the status quo and only increase the quota for organizations and working groups whose need for a higher quota is proven.

President Mahmoud Ahmadinejad said Tuesday at a meeting in Tehran with parliament deputies that a non-rationed petrol quota would cause 'an inflation of more than 100 per cent' and eventually harm lower- income classes.

Ahmadinejad called on all Iranians to learn optimal energy consumption and reduce use of their cars to prevent traffic jams and air pollution.

The president is in favour of compressed natural gas (CNG) systems to fuel vehicles instead of petrol to further decrease the need for refined petrol imports. He has obliged local automobile makers to produce dual-fuel cars running on both petrol and CNG.

The rationing plan is very unpopular, with Iranians asking why - in one of the world's oil-richest countries - petrol should be rationed and why they are not allowed to spend their money for what they desperately need.

Since the introduction of the plan, however, Tehran has seen visible improvements in air quality and decreased traffic congestion, including a 20-per-cent drop in traffic jams and a 30-per-cent decline in accidents.

Opponents of the plan say that petrol rationing has had negative impacts on the economy and social life.

Parliamentarians on Tuesday cited a 70-per-cent decrease in tourist arrivals at summer resorts and pilgrimage venues, causing a severe blow to provinces whose main income is from tourism.

Due to a lack of public transportation, people in big cities including Tehran are suffering serious transportation problems. Many drivers have resorted to buying petrol on the black market at double or triple the price set by the government.

Despite strict government control, prices - and not just taxi rates - have already been increasing following the implementation of the rationing plan.

Observers believe the plan could dent Ahmadinejad's popularity ahead of next March's parliamentary elections or even negatively affect his chances of being re-elected in the 2009 presidential election.