Majles conservatives charged that the government was overcharging the public for gasoline, but Tehran-based journalist Hossein Nazerian tells Radio Farda that in their calculation, the MPs consider the cost of crude oil delivered to refineries at zero, whereas it costs Iran nearly $6 per barrel July 31, 2004 - Gasoline costs the government 350 rials per liter, and at 800 rials per liter, the government not only pays no subsidy for gas, but is making a huge profit, head of the Majles committee charged with reviewing the fourth five-year economic development plan Hossein Sobhani said on Saturday.
He refuted government claims that it provides more than $1 billion in subsidies in order to keep the prices of gasoline and other oil products affordable for the public. Iran imports 40 percent of gasoline consumed by its motorist.
“The Khatami government had said that imported gasoline costs 2,200 rials per liter,” Tehran-based journalist Hossein Nazerian tells Radio Farda’s broadcaster Fereydoun Zarnegar. “But the Majles conservatives are saying that, despite its claims, the government is overcharging for the gas,” he adds.
“Those who are making this claim calculate the cost of Iran’s own crude oil at zero, whereas the average cost to Iran for producing crude oil is nearly $6 per barrel,” he says. The government says it buys gasoline on the international market at 25 cents per liter, which is nearly 2,200 rials, or nearly three times the price motorists pay at the pump.
Reformist officials had complained that the huge subsidies the government pays for gasoline promotes the rising consumption and encourages smuggling gasoline and oil products to neighboring countries, where gasoline is sold at much higher prices.