Iranians have gone online to vent their frustration at the government after it slashed state subsidies on gasoline, a move that has seen the price at the pump skyrocket by up to 75 percent.
The dramatic price hikes, which took effect at midnight on April 25, are expected to test President Hassan Rohani’s support among a population fed up with stubborn inflation, rising costs, and high unemployment.
Observers see it as a risky move. There were riots at some gas stations in 2007 when fuel rationing was imposed for the first time. While there have been reports of no violence or protests after the latest price hikes, police have been put on alert.
Iranians on social networking sites have criticized the government’s move, part of a second phase of government plans to remove energy subsidies and revive the country’s flatlining, sanctions-hit economy.
Kamrooz Akhavon, in a message posted on Facebook, slammed the government’s decision. "The government has been a poison for everybody," he wrote.
Another Facebook user, Feri Razeghi, sarcastically thanked the government. "Thanks, Mr. Rohani. We’ve been waiting for news on higher prices."
Subsidized gasoline, limited for each motorists to 60 liters a month, increased from 4,000 rials ($0.16) a liter to 7,000 rials ($0.28). The price for gasoline sold outside that ration spiked from 7,000 rials to 10,000 rials. Diesel and compressed natural gas prices also rose.
That still makes fuel in Iran among the cheapest in the world, but the price increases have been unwelcome in a country where a quarter of the adult population is jobless or under-employed.
Facebook user Seyed Ali Samaie criticized the government’s downplaying of the price hike. "If this was meant to be a 'mild' increase, then what will a steep increase look like?" he asked.
Iranian state TV this week has aired reports on gas prices around the world, reinstating to the public how low prices in Iran are comparatively.
The government has defended its decision, saying the subsidy slash aims to release government money for production and infrastructural projects in order to improve efficiency and bolster the economy. Iran first began cutting energy and food subsidies under former President Mahmud Ahmadinejad in 2010 to help the ailing economy as it faced increased international pressures over its disputed nuclear program.
Some Iranians, however, have called on Rohani’s government to be given time to change the country’s economic fortunes. One of them, Raha Karemi, posted on Facebook: "Give him more time."
State media have downplayed the negative reception to the subsidy cuts.
The state news agency IRNA quoted Interior Minister Abdolreza Rahmani Fazli as saying that the price increases were expected to take place "without any problems or displeasure from people."
To compensate for the price hikes and avoid public protests, the government has been paying monthly cash handouts. Authorities have invited the poorest Iranians to register to receive a 455,000 rials ($14) in cash assistance per person a month. But according to a top official, only around 2.4 million Iranians, from a population of 75 million, have waived their right to the assistance.