TEHRAN • Iran needs to request an extra two billion dollars to import petrol after its original budget allocation ran out half way through the year, the Isna news agency reported yesterday.
The shortfall comes despite a rationing plan imposed in June that aimed to curb Iran’s massive imports of refined oil products made necessary by its frenzied consumption and lack of refineries.
“For imports of petrol and diesel in the second half of this year, we have asked (the oil ministry) for $2.3bn,” the managing director of National Iranian Oil Products Distribution Company, Nouredin Shahnazi Zadeh, was quoted as saying.
Some $1.5bn of that figure is needed for petrol and $830m for gas oil, he explained.
He said that rising global market prices had already meant the budget for imports of petrol for the Iranian year to March 2008 had been exhausted.
The budget allowance had been set by parliament at $2.5bn, and the government will now need to ask parliament for the extra allowance to last the rest of the year.
Iran is the world’s fourth largest oil producer, but its lack of refineries and colossal consumption encouraged by a heavy state subsidy on fuels means it must import 40 per cent of its petrol requirements.
But Shahnazi Zadeh argued the rationing was having a serious effect on consumption.
“The rationing plan resulted in a 22.5 per cent decrease in petrol consumption compared to the same period last year.”
He put Iran’s average petrol consumption at 60 million litres a day since the implementation of the rationing plan on June 22, and said that the domestic refineries would produce close to 46 million litres a day.
The state subsidy for petrol alone amounted to about $5.8bn in the first six months of the year (March-September), Shahnazi Zadeh said.
The total subsidy so far paid this year on the main fuels derived from crude oil is $17bn, which would double by the end of the year, he said.
Iran is expected to import about $4bn worth of gasoline during the Iranian year ending in March 2008, a senior official said yesterday, suggesting a decline of at least 20 percent from the previous year.
“We have imported five billion litres so far (in the Iranian year that started on March 21) which was worth about $2.9bn,” said.
“If this trend continues we need to import another 2.1 billion litres amounting to $1.1 billion by the end of the year,” he was quoted as saying by the oil ministry’s website Shana.
The two sets of figures indicated total imports this year of $4bn, or at least $1bn less than imports last year.
Last year, Iran imported 9.8 billion litres of gasoline, Shahnazi said without specifying the total cost. He said gasoline prices had increased this year.
