• Tuesday, January 28, 2020

Iran’s petrol price hike cuts fuel use by 20 million liters

Discussion in 'Iranian Defence Forum' started by SubWater, Nov 28, 2019.

  1. SubWater

    SubWater SENIOR MEMBER

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    News / Energy
    Iran’s petrol price hike cuts fuel use by 20 million liters
    Wednesday, 27 November 2019 11:25 AM [ Last Update: Wednesday, 27 November 2019 11:35 AM ]

    [​IMG]
    Iranians fill their vehicles at a petrol station in Tehran, on November 15, 2019.
    Minister of Petroleum Bijan Zangeneh says the government’s introduction of petrol rationing and price hikes this month has cut gasoline consumption by about 20 million liters per day.

    Zangeneh’s announcement Wednesday after attending a cabinet session came as media reports said more than 70 lawmakers had signed an impeachment motion against him.

    In September, Zangeneh said Iranian gasoline production stood at 105 million liters per day, or around 660,000 barrels per day (bpd), while consumption was around 100,000 bpd.

    Iran exported gasoline this year for the first time, but cheap pump prices have Iranian officials expecting new record demand at a time when the country is grappling with the most restrictive US sanctions.

    The Islamic Republic provides some of the most heavily subsidized petrol in the world, with the pump price previously standing at just 10,000 rials (less than nine US cents) a liter.

    According to director of corporate planning at the National Iranian Oil Refining and Distribution Company Alireza Arman Moghadam, the gasoline saved from the price hike is equivalent to three times the capacity of Tehran oil refinery or a 750,000-barrel capacity refinery.

    Gasoline in Iran still remains among the cheapest in the world - only Venezuela’s and Sudan’s are lower - after the government raised pump prices by at least 50 percent this month.

    Each driver with a fuel card will now have to pay 15,000 rials (13 US cents) per liter for the first 60 liters of petrol bought each month. Each additional liter will be charged at 30,000 rials.

    Iran introduced fuel cards first in 2007 as part of its subsidy reform program and its bid to curb huge smuggling - estimated at around 10 to 20 million liters per day - to neighboring countries where pump prices are far higher.

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    Iran
    Leader of the Islamic Revolution Ayatollah Seyyed Ali Khamenei has thrown his weight behind a recent government decision to ration gasoline and increase its price.

    The government has said not a single rial of this price hike will go to the treasury and that the proceeds accrued will be used to help about 60 million Iranians in need.

    The decision is part of Iran’s belt-tightening in the face of US sanctions which have hit ordinary Iranians the hardest.

    For years, Iran used to import part of its growing need for gasoline despite being a major oil producer. Those imports became the country’s strategic vulnerability at the time of sanctions.

    Earlier this year, the Islamic Republic hit a milestone of 100 million liters per day in gasoline production, making the country self-sufficient in the fuel for the first time.

    However, the government’s overnight decision this month to raise prices at pumps caught many Iranians off guard. Even, lawmakers were not informed, leaving many of them flabbergasted.

    They are now intent on holding the government’s feet to the fire and Zangeneh is reportedly on thin ice.

    According to parliamentary news service ICANA, parliament has received an impeachment motion against the petroleum minister, with 72 lawmakers signing on as of Tuesday.

    “The lawmakers are opposed to the manner the gasoline price hike was implemented,” online news website Mashreq reported.

    MP Ahmad Amirabadi-Farahani said the impeachment revolves around nine topics, including “lack of honesty with people regarding the announcement of gasoline price”.

    Zangeneh was grilled by the Iranian parliament's energy committee on Tuesday and is about to face the panel again on December 8.

    If he fails convince the lawmakers, the committee may advance the impeachment motion to the entire 290-member parliament and oust him from office.
     
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  2. Hack-Hook

    Hack-Hook ELITE MEMBER

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    Initial shock it wear off . it also raised the price of 50 necessary consumer goods. And unofficial taxis which attribute to the majority of iran transport systems raised their price by at least 25%.
    And don't tell me about fuel yaraneh its pittance compared to increase in costs .
     
    Last edited: Nov 29, 2019
  3. SubWater

    SubWater SENIOR MEMBER

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    !!!!!!
    did I support this decision ????
     
  4. Cthulhu

    Cthulhu SENIOR MEMBER

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    Gasoline price, after the government raised them by 50 percent. Iran's gasoline price, 0.12 $ a litter, Is based on 1500 tomans a litter, So you might want to double this figure for a more practical comparison. As you can see, We still have a problem, Cause Iran's gasoline price is still much lower than our neighbors, Which still makes it profitable for smugglers to smuggle gasoline. As it's not likely that this government is going to raise the prices anymore, The next government should start rising the gasoline price every year by some percent so we can match the lowest price of our neighbors.
    All of this gasoline price related drama could have been avoided if the 7th Parliament, let by two retards
    Dr. Ahmad Tavakoli and Haddad Adel didn't pass the price fixing bill.
    [​IMG] [​IMG]
    https://fa.wikipedia.org/wiki/قانون_تثبیت_قیمت‌ها
     
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  5. Uguduwa

    Uguduwa BANNED

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    good!! death to communism!!!
     
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  6. Hack-Hook

    Hack-Hook ELITE MEMBER

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    yes we have a serious problem and that's our wages , fix it and then raise the price to what level you like.
     
  7. TheImmortal

    TheImmortal SENIOR MEMBER

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    you can’t just raise fuel price to your neighbor country when they are rich Arab countries with strong curriencies.

    You have to look at relative cost to income of the population. You have to look at median gross income and minimum wage.

    Hypothetical Example, if a low wage worker makes 1000 toman a month you can’t expect him to pay 300 toman to fill his car/truck per month. 30% of his gross income can’t go to transportation.

    So until wage growth picks up, it wouldn’t be wise to raise fuel costs further.
     
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  8. Cthulhu

    Cthulhu SENIOR MEMBER

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    1-Adjusted net national income per capita (current US$) for comparison:
    [​IMG]
    https://data.worldbank.org/indicator/NY.ADJ.NNTY.PC.CD
    2-Minimum wages are adjusted based on the rate of inflation, Not the fuel costs. If raising gasoline prices causes higher inflation rates, Then minimum wages should be adjusted accordingly, This is the right way to go.

    3-And regarding raising gasoline prices, There're only two options, They either start raising the gasoline prices every year by some percent or they can keep the prices fixed for a period of time, Then there comes a time that they get into trouble and have to raise the prices over a night, And ppl will burn half the country. The retards tried the second approach for the past two decades, It didn't work.
    https://fararu.com/fa/news/401802/محسن-رنانی-ما-با-تاخیر-عجیب-در-تصمیم‌های-مهم-مواجه-هستیم
     
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  9. Hack-Hook

    Hack-Hook ELITE MEMBER

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  10. zectech

    zectech SENIOR MEMBER

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    Low wages are keeping inflation in check. Solve inflation by getting the Rial backed by gold, silver and copper... you can increase wages.

    Iran should not sell any of their copper and silver, they should stack that for 10 years and then use the metal to back the Rial. 10 years of low wages, to solve inflation forever and Iran can then raise wages. They could have done this in the past 10 years, but chose not to do so. The same is true with selling their oil for gold bars. If Iran did this, wages could rise.

    Gold is money. Silver is money. Copper is money. Paper is manipulated. Everywhere paper is worthless.
     
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  11. TheImmortal

    TheImmortal SENIOR MEMBER

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    You don’t understand how backing precious metals to a currency ACTUALLY works. People think it’s just this magical solution and will solve all problems. First learn how it works.

    Typically in a scenario where a currency is backed by gold: X amount of said currency is able to be exchanged at any time into Y units of gold.

    If a trader/person/population thinks that the currency (rial) is actually worth LESS than Y units of gold they will begin exchanging rial for gold. The central bank to maintain the exchange rate will begin selling gold out of its reserves and BUYING rial.

    If supply and demand gets too out of whack then the bank would soon be depleting more and more gold to back the rial. This is no different than today when the central bank has to sell dollars/gold to stabilize the rial by buying rial when no one else is.

    So this is why the US did emergency suspension of gold backing in 70’s because too many countries were getting worried about increasing fiscal irresponsibility by the US (Vietnam war).

    So Iran backing its currency to gold really doesn’t solve the underlying issues of Iran’s economy. Most currencies today peg themselves either to the dollar or a basket of developed currencies.
     
  12. BATMAN

    BATMAN ELITE MEMBER

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    You forgot to mention about the protests? Actually no one on pdf leak bad news from Iran.
    After you have friends in Pakistan.
     
  13. zectech

    zectech SENIOR MEMBER

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    There are ways around this. And Iran does not overspend. If their economy is open, they are booming from oil production and exports, if their economy is closed, no need for imports, no loss of gold if there are no imports because there is no loss of rials. And there is the option to only allow gold for nationals of Iran to further keep the gold in the country. That short sellers will lose their shorts.

    If some idiot Western/Isreali banker is short selling the Rial and unable to collect gold because the gold is only for nationals, an Iranian national will buy low and go to the Iranian bank and get the gold, the gold stays in the country. Or better yet, know that he can get the gold anytime and spend that Rial in the country.

    This is to Iran's advantage:

    https://tradingeconomics.com/iran/balance-of-trade

    And if the Iranian government can balance the books and get surpluses to stack gold, then Iran is set. They are awash with foreign currencies from trade, which can be used to buy the Rial if the Rial gets shorted. And can use the foreign currencies to buy gold and silver.

    This is essentially what Qaddafi was doing before the West became aware Qaddafi was going to become a regional power and decided to regime change Qaddafi. Gold is the enemy of the dollar. And crypto is the enemy of gold. So bankers love the cryptos.
     
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  14. zartosht

    zartosht FULL MEMBER

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    Irans problems are geopolitical. not economical at this point. Arguing over macro economics is pointless..

    Iran is a independent nation, who Is a serious challenge to the US position in the middle east .

    there are only 2 other countries that fit this category. Russia and China.

    Russia and China are far more powerful then Iran and have cards Iran doesn't. This shields them from the worse of US/Euro sanctions.

    for example when Russia was threatened with getting banned from swift. they responded in code that if we get destabilized, we will destabilize Europe ( there are a lot of euro countries with large Russian populations who need the Russian army to save them, like in Georgia or Ukraine)

    China has a huge economy that would burn down the global economy if they went full sanctions on them.

    these 2 countries also hold Vetos and are nuclear states.

    Iran is in a middle ground. powerful enough where we cant be pushed around and destroyed like smaller countries or even similar sized countries with less independence (turkey)

    but were not quite Russia/china. we don't have their veto, economy, nukes or ability to retaliate like them. So its far easier to sanction us with impunity.

    until this equation continues Iran will not have a fully prosperous economy. we can get by, even do ok. but we wont see dramatic development. its a fact.

    the only thing that can change this equation is American realization that it cant defeat Iran and come to an understanding (which was happeneing under Obama before Trump showed up)

    or Iran surrenders and agrees to give up its national independence and accepts being an American vassal.

    Its your choice Iranian people. Which path do you want your government to pursue ?? I think the answer is obvious
     
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  15. zectech

    zectech SENIOR MEMBER

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    The point of Putin is to betray the remaining free countries, to be the last 'free country' and then to defect to the West. Watch the Hunt for the Red October, a piece of Amerikan propaganda. Putin is like the captain of the Red October - a traitor who wants to hand over Russia to the West. But if Russia defects early, the free world, including Iran would prepare better from the onslaught by zionists. The zionists placed Putin in for the purpose for people to think the free world has Russia as a free country fighting the zionist slavers. Normally the Tories and Labour Party are both zionist controlled, this is the West's fight against Putin. Both zionist controlled. Putin won't defect until revolution destroy Iran and China is defeated. And Erdogan is replaced in another coup. And North Korea is nuked out of existence. And Venezuela has no friends and falls to sanctions and corporate boycotts. Bolivia already fell because they were not smart enough to control their own military and have somebody from Morales' Party to replace him in an election.

    New countries will wake up like Vietnam and the rest of Indochina and fight the zionists. But midnight darkness could envelope them too.
     
    Last edited: Dec 1, 2019