As per a new initiative taken up by the Majlis Planning & Budget Commission, there is a proposed hike of gasoline prices in the domestic market. These reports were confirmed by Jafar Ghaderi, who is a member of the Planning Commission, and the price hike would be a significant one.
Presently, the prevailing rates of gasoline are subsidized and consumers in Iran are able to purchase gasoline at a price of 4000 Rial per liter. The price is after a subsidy by the Iranian Government, and in the free markets, where there is no subsidy, the market rate is 7000 Rial per liter. However, the Government is planning a steep hike and the planned price is around 16000 Rial per liter of gasoline, which is a sudden surge.
The main reason for the abrupt price hike is because there are several international sanctions being imposed on Iran and they do not have any other way out. The shady nuclear program of Iran has caused several international sanctions and the Iranian Government is not able to subsidize the costs more than a certain extent.
The breather for gasoline consumers is that the bill for the price hike is yet to be reviewed by the Parliament. Jafar Ghaderi said that they have still not discussed the options for a price hike in the parliament, and it is likely to happen over the next few days.
It can be noticed that Iran is suffering severely from unemployment and high inflation in the markets over the past two years. It is clearly reflected on the liquidity of the market as the people’s spending power and affordability of life has dropped significantly. MPs are urging the government officials to look into this matter, and take steps so that the economy of Iran is revived.
The root cause for the economic turmoil in Iran is the embargoes, maintained by the United States and European Union,toward the economy of Iran. Many sectors in Iran have been affected greatly and they are having a tough time having a stable financial status.