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Gasoline rationing is ordered in Iran

The move, made necessary by a lack of refining capacity, elicits anger in Tehran. A fuel station is set ablaze.

June 27, 2007|From Reuters

TEHRAN — Iran said it would start rationing gasoline today to wean the No. 2 OPEC crude producer off costly fuel imports, but the announcement Tuesday sparked anger here in the capital, where one gas station was burned.

Despite its huge energy reserves, Iran lacks refining capacity and must import about 40% of its gasoline.

Flames rose from a fuel station in Pounak, a poor area of Tehran, that was set on fire after drivers rushed to get fuel before the beginning of rationing at midnight, witnesses said.

"Guns, fireworks, tanks, [President Mahmoud] Ahmadinejad should be killed," angry youths chanted as they hurled stones, a witness said. Another witness said riot police were trying to disperse the crowd.

At other gasoline stations throughout the capital, cars stretched along main streets and down alleys.

Imports are a big burden on state coffers because all fuel, whether imported or domestically produced, is sold at heavily subsidized prices. Even after this year's 25% price increase, gas sells for about 41 cents a gallon, among the lowest prices in the world.

Private cars will get 100 liters, or about 26.4 gallons, of gasoline a month, but less if they also burn compressed natural gas, state television said. Drivers say the amount is too little.

Parliament and the government had debated whether any rationing plan would allow drivers to buy extra fuel at market prices. Tuesday's announcement made no mention of that.

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