The new scheme for rationing gasoline based on the national code was carried out for two months without any problems on Kish Island in the Persian Gulf, secretary of the Supreme Council of Free Trade-Industrial and Special Economic Zones said.
“The results of the pilot project were delivered to the government and if approved, it will also be implemented in other cities,” Saeed Mohammad was also quoted as saying by Mehr News Agency.
Initially, it was announced that the project would be launched on Qeshm Island, along with Kish, but it did not happen.
Responding to the issue, Mohammad, who is also an advisor to the president, said, “Qeshm Island is prepared for the pilot plan but so far we have not been notified to do so.”
Gas stations in Qeshm are now equipped with the new software system and the plan will be implemented for a month, but the exact date to start the program has not been decided.
As per the plan, each resident with a national code is allocated 20 liters of gasoline per month at a rate of 8 cents per liter, regardless of the fact that they own a car or not. Those who did not have cars were allowed to sell their quotas to others.
The plan seeks to curb gasoline consumption, fight fuel smuggling and allow all citizens to benefit from fuel subsidy equitably.
As of 2019, private car owners have been receiving a quota of 60 liters of subsidized gasoline for each car every month with a fuel card at the rate of 15,000 rials (8 cents) per liter. Additional purchases (maximum 250 liters per month) cost 30,000 rials (15 cents) per liter.
That scheme is considered unfair because households with three or additional cars benefit from this subsidy more than families with no cars.
Fuel quotas (60 liters per car per month) were first introduced in 1981 one year after the start of the 1980-88 Iraq-Iran war and again in 2007. In six months, consumption fell by 25 million liters.
Eight years later, in May 2015, the government announced gasoline would be sold at a single price of 10,000 rials without any restrictions and fuel cards seemingly became a thing of the past.
Output and Consumption
During the two-week Norouz (Iranian New Year) holiday season, on average 112 million liters of gasoline were consumed every day across Iran, which was 30% higher than the same period of last year when motorists used 87 million liters of the fuel.
Domestic demand has rebounded from pandemic lows and risen steadily since Iran lifted most of its Covid-19 restrictions late last year. Officials have warned that the country could become an importer of gasoline and diesel again within three years, if domestic consumption continues to rise at current rates.
Therefore, increasing gasoline output is on the agenda of the Oil Ministry. One of the projects completed in this regard was at Lavan Refinery and the facility can now convert naphtha into gasoline with the help of domestically-produced catalysts.
The refinery’s naphtha was exported, but now that the conversion unit is complete and the catalyst is available, exports are halted and naphtha is converted to gasoline.
Iran has the world's second-cheapest gasoline after Venezuela. While one liter of gasoline in Venezuela costs 2 cents, it is sold for 8 cents in Iran. The average international price for the same fuel is about $1.
The low price of gasoline is one of the reasons for its high consumption.
Per capita gasoline consumption in Iran, with a population of 84 million, is above the global average.
Based on data from the Oil Ministry and the National Iranian Oil Company, daily consumption of gasoline in Iran is about 115 million liters.
