Alan's note: the social unrest that will come about with a gasoline shortage might well be the first nail in the coffin of the Isalmic regime. From the regime's standpoint, the limit on fuel will act as a self-imposed curfew as fewer people will be albe to roam - and do mischief.
Oil-rich Iran may run out of gasoline next month
By Marc Wolfensberger Wednesday, July 5, 2006
TEHRAN, Iran -- Iran, the world's second-largest holder of oil reserves, may run out of gasoline by the end of August, one month earlier than expected, as surging world prices bankrupt the government's price-subsidy program.
Iran's $2.5 billion budget for gasoline imports this year will only suffice until the end of August if prices keep rising, Hojatollah Ghanimifard, executive director for international affairs at National Iranian Oil Co. said on Petroenergy Information Network, Iran's Oil Ministry news agency.
The ministry has said it will have to ration gasoline to 3 liters a day (0.8 gallons) from as early as September following a parliamentary decision in March to cut its annual budget for gasoline imports by 40 percent. Instead of spreading measures throughout the year, the government has opted to wait until the budget is exhausted to ration gasoline.
The Islamic Republic is in the process of distributing "smart cards" that will limit the amount of gasoline individuals can buy, Deputy Oil Minister Mohammad Reza Nematzadeh said last month. The program is running behind schedule, and Iran will take at least another six months to complete it, newspaper Sarmayeh reported on June 21, citing an unidentified energy official.
Without a rationing system in place, Iran's parliament will likely have to approve an emergency budget extension to bridge the gap.
The country's gasoline demand has grown at 15 percent a year as waste, a lack of refining capacity and smuggling have boosted fuel imports, the Paris-based International Energy Agency said in the April issue of its monthly report.
Iran, the second-biggest oil producer in the Organization of Petroleum Exporting Countries, imports more than a third of the gasoline it uses, about 188,000 barrels a day. Last year, the country spent about 10 percent of its $44.6 billion crude oil export revenue on gasoline imports.
Subsidies ensure Iranian drivers pay the equivalent of $4 for a 40-liter tank of gasoline. The same amount of gasoline would cost $31 in the U.S., using the July 3 average unleaded price from the American Automobile Association.