Middle East

Iran radically raises petrol prices by 50 percent

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Iran imposed petrol rationing and raised pump prices by 50 percent or more on Friday, in a new move to cut costly subsidies that have fuelled high consumption and rampant smuggling.

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The Islamic republic provides some of the most heavily subsidised petrol in the world, with the pump price previously standing at just 10,000 rials (less than nine US cents) a litre.

Each driver with a fuel card will now have to pay 15,000 rials (13 US cents) per litre for the first 60 litres of petrol bought each month, the state-run National Iranian Oil Products Distribution Company said.

Each additional litre will be charged at 30,000 rials.

Fuel cards were first introduced in 2007 with a view to reforming the subsidies system and curbing large-scale smuggling.

The head of Irans Planning and Budget Organisation, Mohmmad Bagher Nobakht, said the proceeds from the price hike will be used to provide additional subsidies for 60 million people in need.

He said President Hassan Rouhani had insisted that “all extra revenues from the petrol price reform should be paid back to the people”.

“The first payments will be handled within the next week or 10 days,” Nobakht told state news agency IRNA.

Ulta-low petrol prices have led to high consumption, with Irans 80 million population buying an average Read More – Source

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