Petrol prices to double under Iran's war economy
Iran is raising the price of petrol for heavier users as the country's wartime economy comes under growing strain, with a widening fuel deficit exposing the limits of its ability to maintain subsidised supplies. The move risks adding to the pressure on households already facing the economic effects of the conflict , while reviving memories of the 2019 fuel-price protests that erupted into…
Iran is set to double petrol prices for heavy users amid the country's strained wartime economy and widening fuel deficit. This decision risks increasing pressure on households already grappling with the economic fallout of the conflict, reminiscent of the 2019 fuel-price protests. The petrol price hike is exacerbated by US sanctions and a naval blockade that limit Iran's ability to earn oil revenue and import fuel needed to meet domestic demand.
The US has also retaliated with strikes on Iranian tankers, intensifying the pressure on Tehran's oil trade and access to foreign currency. The rial has fallen to a record low, and Iran is experiencing a significant petrol shortage, with daily consumption exceeding production by 14-15 million litres. The government announced the new price measure to address the supply-demand imbalance caused by rising consumption.
However, concerns have emerged about the potential for public unrest, as queues have already formed at petrol stations ahead of the increase, and experts warn that this move could spark a crisis akin to the 2019 fuel protests that led to nationwide unrest and violence.
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