Mandatory use of fuel cards that will come into effect in two months but cannot curb gasoline smuggling unless each car owner is obliged to use his/her own card to fill up, the former head of the National Iranian Oil Products Distribution Company said.
"Fuel smuggling and consumption can be reduced only if and when the fuel cards are also used as vehicle ownership cards. Otherwise, the plan will fail to serve the intended purpose," Hassan Zia Kashani was quoted as saying by IRNA.
Now that fuel is not supposed to be rationed, allowing vehicle owners to use whoever’s card they want to buy unlimited amount of fuel is waste of money that will be invested to reactivate fuel cards, he added.
Kashani is of the opinion that NIOPDC “should install cameras at gas stations that match the car registration number with the fuel card number and only if they are compatible should the pump activate.”
"Operating such a system will be costly, but it is worth the investment and can help cut both fuel consumption and smuggling because fuel cards then cannot be lent and borrowed easily," he noted.
Referring to the colossal volume of fuel that is smuggled in the border regions (about 20 million liters/ day, he said that close to 350,000 fuel cards are being used in border provinces including Sistan-Baluchestan that do not belong to car owners in those regions and have been rented from vehicle owners in other provinces.
Fuel rationing system and obliging motorists to use fuel cards at pumps was introduced in 2007 to curb overconsumption and worked perfectly. In a 6-month period consumption fell by 25 million liters, he said.
Kashani said the plan to restart use of fuel cards without rationing is not justified because it can neither help curb rampant fuel smuggling nor create any incentive to reduce consumption.
As per a directive issued by NIOPDC, motorists as of August 11 will be able to purchase fuel at the pumps only with a fuel card.
According to NIOPDC, using gas station owners' cards instead of car owners' smart cards will be illegal from the day the new rule takes effect.
The directive says the plan has nothing to do with fuel rationing.
Galloping inflation and decline in value of the rial over the past year has further widened the gap between fuel prices in Iran and the neighboring countries. This has led to a big jump in smuggling of subsidized fuel (20 million liters a day) from the border areas to Pakistan and Afghanistan.
The discrepancy in prices in Iran (7 cents/liter) and most neighboring countries (75 cents) has made fuel smuggling a highly profitable and tempting trade.
As per official data, average daily gasoline consumption has increased from 87.1 million liters last year to 91.2 million liters now. NIOPDC produces 105 million liters of gasoline per day.
