Iran: Western sanctions are hitting home?

At midnight on Sunday, gas prices went from about 38 cents a gallon to about $1.44 a gallon or about 10 cents a litre to 38 cents. This almost quadruple increase in prices comes after the government started removing subsidies that have kept those prices low. Apparently this plan has been delayed out of fear of a repeat of the 2007 riots after gas rationing was necessary.

 

According to the Associated Press, the new system means that each personal car receives 60 litres (16 gallons) of subsidized fuel a month costing 40 cents a litre ($1.50 a gallon) — up from the just 10 cents a litre. After that further purchases of gas would run 70 cents a litre ($2.69 a gallon), up from just 40 cents.

 

There is obviously a lot of hurt throughout the Iranian society. Newspapers have been talking with various people dependent on fuel in their job like taxi drivers and truck drivers and each has said their costs are going up but they can’t raise their rates. They would either be too expensive and nobody would buy their services or they could be reported to authorities.

 

International sanctions have targeted various areas of the Iranian economy including oil; Iran is an oil producing country. Other countries have stopped business dealings and sought connections elsewhere in the world. As such, Iran’s economy has suffered and the cutting of subsidies represents the government trying to curb its spending. In the end, the pursuit of its nuclear ambitions may be taking a greater toll on the average person in the street than the Iranian government may be willing to admit. Analysts are taking a wait and see attitude as to whether Iranians will accept this important change in the way they live or popular unrest erupts at some moment.

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