Iran Announces New Tiered Gasoline Pricing Plan to Manage Consumption
In a move to address rising fuel consumption and its associated fiscal pressures, the Iranian government has unveiled a new tiered pricing system for gasoline. The plan, reported by media outlets citing the President’s executive deputy, aims to create a more structured approach to fuel allocation and cost.
A Three-Tiered Structure
Under the newly proposed framework, the pricing model is structured around individual consumption levels:
- Tier 1: Each person will have an allocation of 60 liters of subsidized gasoline per month at a price of 1,500 Tomans per liter.
- Tier 2: Consumption beyond the initial 60 liters and up to a total of 100 liters will be priced at 3,000 Tomans per liter.
- Tier 3: Any consumption exceeding 100 liters per month is expected to be calculated at a different, yet-to-be-specified rate.
Addressing Economic Realities
The policy shift comes after years of a fixed gasoline price, which has remained unchanged since 2019. Officials point to a significant increase in national fuel consumption, which has created substantial financial strain on the state budget. The new system is designed to rationalize usage while maintaining support for average consumers.
Targeted Impact on Household Budgets
Analysis indicates that the new policy will primarily affect the top 20% of urban households (the ninth and tenth deciles), as these groups typically consume more than 100 liters of gasoline per month. For the majority of the population, the direct impact on their cost of living is projected to be contained.
Data from the Statistical Center of Iran reveals that gasoline currently accounts for less than one percent of the average Iranian household’s total expenses. Experts attribute this low share directly to the six-year price stability of gasoline, a factor the new policy seeks to recalibrate for long-term economic sustainability.