President Masoud Pezeshkian Prepares Iran for Significant Fuel Price Increases to Stabilize Ailing Economy
The Iranian government is preparing to increase fuel prices to alleviate the financial burden of heavily subsidized petrol for its 93 million population. President Masoud Pezeshkian noted that while the administration pays 1.3 million rials per litre of petrol produced by refineries, the lowest price tier offered to the public is less than one cent per litre. To compensate for financial losses caused by the US-Israel war and economic sanctions, the government is considering three main options: maintaining current prices with a first-come, first-served mechanism, offering a monthly quota of 30 litres at the lowest price tier for all citizens, or fully liberalizing prices to approximately 44 cents per litre. While a full price hike would increase transport costs for businesses, it could create an inflationary bubble. The administration is currently balancing these measures to avoid the unrest seen in previous years. The Iranian rial hit a new all-time low of 2 million rials per the US dollar following a threat from President Trump to target Iran with a 'most crushing economic operation.'