Iran scraps subsidized gasoline allowance

Iranian motorists will see a monthly allotment of 60 liters of subsidized gasoline canceled from Tuesday.

The government is struggling to furnish monthly cash handouts to every Iranian, which is a legacy of former President Mahmoud Ahmadinejad after he scrapped subsidies and introduced a system of compensation.

Under the program, Iranians driving homemade cars could fill them with 60 liters of gas per month by using a smart card at the subsidized price of 70,000 rials (25 cents) per liter while without it they had to pay 35 cents.

From Tuesday, ever driver will pay 35 cents per liter at gas stations, officials said.

“Subsidized gasoline supplies were corrupting and had led to misuse by certain individuals,” head of the institute of fuel station owners Naser Raeesi-Fard told IRNA.

He said subsidized gasoline had given rise to smuggling in which a sizable volume of gasoline was being trafficked into Iran’s neighbors every month.

The news agency reported normal traffic at gas stations in the capital Tehran but there were already haggling between some commuters and cab drivers over fare hikes.