Smart fuel cards should be replaced with bank cards, as the electronic fuel card hardware system imposes high expenses on the government, while vehicle owners have to spend millions of dollars on renewing their cards annually, the head of Gas Stations Guild Union said.
“The fuel card hardware has become obsolete and scrapping the system is now a compulsion, as its overhaul will cost billions for the state-run National Iranian Oil Refining and Distribution Company,” Asadollah Qolizadeh was also quoted as saying by ILNA.
Thanks to the development of technology, replacing fuel cards with bank cards will not be difficult and the scheme offers several benefits, one of which is that car owners do not need to waste time in long queues at gas pumps as most systems have outlived their usefulness.
“A large number of fuel card hardware systems have gone out of service and cannot read the information on the card correctly and apparently NIORDC, a subsidiary of the National Iranian Oil Company, has no plans to get them repaired because it is not economical for the state-run firm,” he added.
According to the official, managing fuel quotas and making payments can be easily managed with the help of bank cards and the fuel cards have become redundant.
Qolizadeh noted that the plan can be piloted in the gas pumps of a few provinces and if desirable results are obtained, it can be implemented nationwide.
The official noted that fuel cards and bank cards must not be integrated, as the integration will create a huge database whose security will be a big concern and it will make things more complicated.
Unprecedented Average
Gasoline consumption is rising and projected to reach an unprecedented average of 125 million liters per day in coming weeks.
“A 20% rise in consumption has been estimated by NIORDC, as most Iranian families will make their summer trips between July and September,” Qolizadeh said.
Data released by NIORDC show that the current consumption stands at 110 million liters per day.
The official noted that although all Iranian refineries are functioning at full capacity, NIORDC’s maximum daily output will not exceed 110 million liters in the next five years, meaning the company will either have to import fuel to bridge the gap, or tap into the strategic reserves.
Iran’s strategic gasoline reserves hold 4 billion liters.
Gasoline demand in Iran dropped to an all-time low of 75 million liters per day in 2019 when the government announced fuel price hikes. However, the current price of gasoline in Iran is around a tenth of prices charged in neighboring countries, causing a major surge in fuel smuggling across the borders.
That comes, as the government has indicated it has no plans to increase fuel prices.
Close to 800,000 new low-quality cars have been added to Iran’s transportation fleet, whereas old gas guzzlers are not sent to the junkyard. If the current trend of consumption were to continue, the country will surely face problems in meeting domestic demand.
