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Iran Imposes Gasoline Rationing, Raises Prices As U.S. Sanctions Continue To Bite

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Iran has imposed rationing and hiked fuel prices as the economy continues to suffer under U.S. sanctions. (file photo)

Iranian authorities have imposed rationing on gasoline purchases and have increased the price of fuel substantially as the economy continues to be hit by U.S. financial sanctions.

The National Petroleum Products Distribution Company on November 14 said a 60-liter monthly limit of gasoline will be set on every private automobile and that prices will go up to about 12.7 cents a liter from nine cents.

Prices for taxis and ambulances will also be at 12.7 cents a liter for up to 500 liters.

After the amount quota amount is met, the price will rise to 26 cents a liter.

The announcement drew sporadic protests on November 15 in areas including the northeastern city of Mashhad, the southeastern province of Kerman, and the southwestern province of Khuzestan, according to the semiofficial news agency Fars.

Iran continues to have some of the lowest fuel prices in the world, supported by heavy government subsidies.

The country has huge energy reserves, but it is struggling to meet its domestic fuel needs because of a lack of refining capacity. International sanctions add to the problem by limiting the supply of spare parts to repair and upgrade facilities.

Fuel rationing introduced in 2007 under former President Mahmud Ahmadinejad to curb consumption led to anger and violence, including the torching of several gas stations. It was halted in 2015.

Many Iranians had speculated on the possibility of renewed rationing since the United States in May 2018 withdrew from a 2015 nuclear deal that Tehran signed with six world powers and began reimposing crippling sanctions, which had been eased in return for curbs on Iran’s nuclear program.

In May, Iranian drivers queued up in long lines at gasoline stations in Tehran and several other cities to fill their gas tanks amid rumors that gasoline rationing would go into effect on May 2.

Iran’s Oil Minister Bijan Namdar Zangeneh denied the rumors at the time, calling them a "lie."

Razmezan Shojaei Kaisari, an official with Iran's Interior Ministry, said on May 2 that a final decision had not been made about "the extent" or "timing" of rationing while adding that the issue was being reviewed.

On November 12, Iranian President Hassan Rohani said the country in recent months has been facing its "the most difficult" time in decades

With reporting by AP and Reuters
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