Friday, October 14, 2005

Iranian parliament considers two-tier fuel prices :: Iran Daily

The government fears raising the price of gasoline and diesel for fear of the political unrest it will create. Current prices are absurdly low:
Hadi Haqshenas, a member of the Majlis Plan, Budget and Audit Commission, told ISNA that the government has submitted a bill to the Parliament seeking to withdraw close to three billion dollars from the Foreign Exchange Reserve Fund for gasoline imports, stressing that had officials made macroeconomic decisions without taking political issues into consideration, the country would not have faced such dilemmas today.
The two-tier system being considered
stipulates that gasoline must be sold at international rates once consumption goes beyond a certain level.
It's not clear whether that's an individual's consumption or the country's consumption. If it's the country's that will create interesting incentives for individuals.



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