Iran: Gasoline and shock therapy

Financial Tribune | Amin Sabooni: When the government raised pump prices last week by 50%, from 10,000 rials to 15,000 rails (for subsidized fuel — 60 liters/per car/per month) and by 200% for unsubsidized gas, it did not go well with the working class, albeit, that is to say the least

Friend and foe have been trying hard to figure out what happened and why in the eight days after the government decided to cut fuel subsidies, sending gasoline prices to levels unseen in Iran ever since oil was discovered more than a century ago.

In all likelihood more price rises accompanied with protestations are still to come.

With the benefit of hindsight, it must be said that we have come a long way, for better or worse. This can be said of almost everything and everywhere — countries big and small, rich and poor, developed and underdeveloped.

One thing that has almost always been of paramount interest and importance in our country is the price of oil and by extension that of gasoline and diesel.

Leaving the politics of oil to oilmen and the powers that be, this piece will try to concentrate on the price of gasoline and what it entails for the trust factor between the rulers and the ruled.

When the government raised pump prices last week by 50%, from 10,000 rials to 15,000 rials (for subsidized fuel — 60 liters/per car/per month) and by 200% for unsubsidized gas, it did not go well with the working class, albeit, that is to say the least.

Now let’s do some gasoline price numbers. Forty years ago in 1979 when the revolution happened one liter of gasoline cost 10 rials. Today it costs 30,000 rials (not including the subsidized 60 liters/per car/per month at 15,000 rials. For taxis, vans and pickups, the formula is different and diesel prices remain unchanged for now).

Leave a Reply

Your email address will not be published. Required fields are marked *