Posted on 06/24/2006 2:11:13 AM PDT by familyop
TEHRAN, June 23 (Reuters) - Iran will halt its massive gasoline imports from Sept. 23 and impose fuel rationing, the oil minister said on Friday -- a political gamble in a country where subsidised fuel is viewed as a national right.
Parliamentarians in the world's fourth biggest oil producer approved a budget for the year to March 2007 that cut the amount to be spent on gasoline imports to $2.5 billion from $4 billion.
This meant President Mahmoud Ahmadinejad's populist government, which draws its support from the poor, was faced with an unappetising choice of hiking petrol prices or rationing, both potential sources of social discontent.
Oil Minister Kazem Vaziri-Hamaneh told state television the government's final ruling would come next week.
"Because there is no budget for importing gasoline in the second half of the year, naturally imports will be stopped and gasoline will be supplied by rationing," he said.
The second half of the Iranian year begins Sept. 23.
Iranian officials sometimes make sweeping assertions about not importing commodities but then continue to buy shipments undaunted. Iran claims self-sufficiency in wheat but nevertheless buys shipments of the grain.
One proposal was to allow motorists a certain number of rationed litres subsidised at the current price of nine cents per litre. They would then have to pay the full market price for anything above that.
But Vaziri-Hamaneh rejected that option: "With 99 percent certainty there is going to be no dual pricing system, just rationing."
IRAN NEEDS MORE REFINERIES
Despite holding the world's second biggest oil reserves, Iran lacks refinery capacity and imports more than 40 percent of the 70 million litres (440,000 barrels) of gasoline its motorists burn each day.
Iran's oil revenues go to the government which has not shared the state oil company's enthusiasm for refining projects.
Most of the gasoline imports come from western Europe, with trading house Vitol the leading supplier, market sources said. India has also featured as a key exporter, at times supplying up to 25,000 bpd.
Conservative Iranian politicians have dismissed fears that rationing could spark social unrest, stressing how Iranians accepted a coupon system during the 1980-1988 war against Iraq.
But political analysts have expressed doubts that Iranians will be so stoical today. Most traded goods move by road and hikes in fuel prices and transportation have traditionally sparked sharp spikes in the cost of basic goods.
Iran's cheap gasoline culture chokes big cities with heavy pollution. Economists identify Iran's subsidies as one of the principal reasons for its flaccid and uncompetitive industry.
Many officials have also argued that Tehran's dependence on imported gasoline threatens national security. It is a sensitive target for any sanctions imposed over atomic work.
Iran has ambitious plans to upgrade refineries over the next five years and lift daily gasoline output to 120 million litres. But investment has been sluggish.
Yes, Iran does refine some of its own oil but not enough. The leadership there called for increases in gasoline production a few weeks ago, but that is most likely a struggle for them. Large refinery construction projects aren't cheap.
Oops. I intended to put this in "Extended News" instead of Free Republic. ...many thanks, if you would/could take it out of Free Republic and put it in Extended News.
(Denny Crane: "Every one should carry a gun strapped to their waist. We need more - not less guns.")
From ... http://dictionary.reference.com/browse/populist
"populist:
n : an advocate of democratic principles"
"democracy:
noun
1 [U] the belief in freedom and equality between people, or a system of government based on this belief, in which power is either held by elected representatives or directly by the people themselves"
The Communist/Socialists and their enablers keep playing the same old tired song.
Just goes to show how stupid their government is. First of all, since the state owns the oil it makes no sense that they don't also refine it. It's stupid to export oil to France and then have it reimported as gasoline.
Of course, it's also stupid to subsidize it, as it discourages effeciency and increases dependency. It's also stupid not to let private enterprise, in a competitive environment, manage the resources.
Nobody claimed that Amydingynutjob is a genius...
Make that Amadingynutjob...
Neither are turbomolecular centrifuges and diffusion plants for UF6, but they do not seem to have a problem with that..
I guess exporting a form of radical islam is much more important then governing in a responible manner for its people.
They know gasoline sanctions are coming anyway.
Well, well. I've read an awful lot about the situation with Iran but never came across that piece of information before. It sounds like 'embargo' could cut two ways. I wonder how much reserves they have and how long it could take them to start hurting as well if the Straits of Hormuz were blocked.
This is a government that used duped children as mine clearers. They also utilized the human wave as a battlefield strategy. They do not care at all about the populace. After all, in two years, the Hidden Imam returns(/s). Whatever happens, it will be the will of Allah and the fault of the Great Satan, the Little Satan and the Jooooooooooooos.
However, your point is well taken and hopefully, this will fuel (intended) an increased popular revolt.
I will bet that the military and the domestic police forces will have enough fuel for whatever they need to accomplish.
Iran unable to block Hormuz
http://www.freerepublic.com/focus/f-news/1621693/posts
Yeah, but Carter didn't have the power to destroy those who oppose him.
And, Carter was eventually elected away.
This goes a long way in explaining why their head nutjob has been practically begging us to attack them for a couple of months now -- so he could have blamed rationing &c on us. Off by a couple of months, tsk tsk.
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