Fuel rationing saves Iran $1bn

An Iranian man pumps fuel to his car. Rationing has saved the country $1 billion in its first hundred days in place. (Getty Images)

Iran said on Saturday it had saved $1 billion in the first hundred days since the world's fourth largest oil producer began rationing gasoline for drivers, the official Iranian news agency IRNA reported.

Despite being a major oil exporter, Iran lacks refining capacity and has had to import increasingly large amounts of gasoline to meet surging demand for fuel - until rationing was introduced on June 27 to put brake on consumption.

Iran spent $5 billion or more on importing gasoline last year. The fuel, whether shipped in from abroad or produced at home, is sold at heavily subsidised prices to drivers.

"$1 billion was saved during the past hundred days," said Nasser Sadjadi, manager of the system of 'smart' electronic cards used to allocate quotas, IRNA reported.

Another Iranian official had previously said he expected rationing to save $3 billion in the Iranian year ending in March.

"The average petrol consumption in the past 100 days dropped to 60.5 million litres per day, which was 22% lower than the same period last year," Sadjadi added.

Officials have said consumption has dropped dramatically from the 75 million litres a day or more that was consumed before rationing began. Some officials figures show it has been creeping back up, hitting 63 million litres in August.

As well as weighing on state coffers, gasoline imports are an area where Iran is vulnerable as it faces the prospect of tougher UN sanctions in its dispute with the West over its nuclear plans.

Many private drivers complain that they do receive adequate fuel under the scheme that allows them just 100 litres a month.

The government has refused to offer any additional fuel outside the quota system, even at a higher price than the 1,000 rials (about 11 US cents) a litre now charged.

Parliamentarians are pushing for fuel at free market prices to be made available.

Echoing comments by other Iranian officials, Sadjadi said the government had no plan to announce a free-market price for gasoline outside the rationing scheme.

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