Dear MEL Topic Readers,
Iran petrol price hike: Protests erupt over
surprise rationing
Iran’s economy has been badly suffering from the
US sanctions that came into effect in 2018, which have slashed nearly a half of
its imports and exports. In fact, since about 80% of the nation’s public
revenue depends on oil export, Iran’s currency has gone down to record lows, the
annual inflation rate quadrupled, which triggered numbers of public protests,
especially by low-income earners.
The Islamic country has been heavily subsidizing
gas prices and is one of the cheapest gas providers in the world taking the
currency rate into account. The gas price had been only 10,000 Rial, about a
little less than a quarter of a US dollar, per litter up to 250 litters a month. It sounds even cheaper than a bottle of water. So, a person who pumped 250 litter
last month paid 2,500,000 Iranian Rial or approximately 62 dollars. However,
the government suddenly and substantially reduced the subsidize effective
immediately. Now, a driver who fills the same gas tank has to pay 165 dollars each
month for the same amount of gas. That’s a 264% price hike! Even though a
liter of gas costs USS.66, still no more expensive than any developed
countries, those who drive a lot will suffer the most, such as long commuters,
taxi drivers and local transporters. Angry drivers ran riots on the streets in
many cities and clashed with police forces. It sounds just like what happened in
Santiago, the capital of Chile, recently whose city government tried to raise
the metro price and caused commuters protests that sparked nationwide protests
against inequality.
The Iranian government said the reduction of
the gas subsidize is intended to provide allowance to low-income families. But
for some people, the allowance could be offset or even counter-compensated by
the price hike.
Enjoy reading and learning about the public
sensitivity of transportation costs.
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