For the first time since a price increase in 2019 that provoked nationwide protests and a crackdown that allegedly killed over 300 people, Iran implemented a new pricing tier for its government subsidised petrol on Saturday in an effort to control skyrocketing costs.
In Iran, cheap petrol has long been seen as a fundamental right. In 1964, a price hike compelled the shah to replace striking cab drivers' vehicles with military vehicles, which sparked widespread protests.
However, economic sanctions imposed because of Tehran's nuclear program and the country's rapidly declining rial currency are putting increasing pressure on Iran's theocracy.

This has increased the price of some of the cheapest petrol in the world, which costs only a few pennies a gallon. The government's reluctance to raise prices, however, probably indicates that it want to avoid any conflict with the weary citizens of the country following Israel's 12-day invasion in June.
Saeed Mohammadi, a teacher who works as a taxi driver in his free time to make ends meet, angrily declared, "Our discontent has no result." "The government acts as it pleases. They don't enquire about people's agreement.
The new price per gallon is still cents.

In the clear, chilly weather on Saturday morning, drivers appeared at ease as they refuelled at four petrol stations in northern Tehran. There were occasionally lone police cars parked close by, but there were no obvious issues or lengthy lines at the pumps.
The nation's long-standing subsidy scheme now has a third pricing level according to the new pricing structure that went into effect on Saturday. Drivers can continue to get 60 litres (15 gallons) every month at the subsidised rate of 15,000 rials per litre, or 1.25 US cents, under the altered structure. The next 100 litres (26 gallons) will continue to be paid at 30,000 rials per litre, or 2.5 cents.
Beyond that, purchases are subject to the new pricing structure, which is 50,000 rials per litre, or around 4 cents.

Iran implemented fuel rationing in 2007, yet the demand for the extremely inexpensive petrol hasn't decreased since. Iranian petrol prices are still among the lowest in the world, even at that current rate.
The Iranian government's subsidy is the difference between the fuel's cost at the pump and its production and delivery costs. Iran paid the second-highest energy subsidy expenses in the world in 2022, only surpassed by Russia, according to the Paris-based International Energy Agency. Iranian officials admitted that tens of billions of dollars are used annually to artificially keep energy prices down, and the IEA estimated Iran's oil subsidies at $52 billion that year.

The price of petrol has increased fifteenfold since 2009, according to Tehran-based economist Hossein Raghfar, who expressed a negative opinion of government subsidies.
"It not only failed to reduce the budget deficit, but it also caught the nation's economy in a vicious cycle of budget deficit and inflation," he stated.
Iran's government, according to 35-year-old bank employee Hamid Rezapour, has "no choice except to increase the price to manage the country's economy."
He declared, "It needs more money to pay for public needs." "In my opinion, it is an indirect tax, even though it hardly functions in a chaotic economy."Protesters' first walk since 2019
This is the biggest adjustment to Iran's fuel-subsidy scheme since 2019, when protests across the country were triggered by an abrupt 50% hike in subsidised prices and a 300% increase in the rate for purchases over quota.
Some demonstrators set fire to banks and petrol stations as security forces suppressed protests in 100 cities and towns. Amnesty International claims that at least 321 people were killed in the subsequent crackdown. Thousands of people were arrested.
Every 10,000-rial increase in petrol prices, according to critics, might result in a 5% increase in inflation. The country is currently dealing with an annual inflation rate of about 40%.

However, inexpensive petrol gives the nation a chance to create jobs. The Islamic Republic has 25 million automobiles, including 6 million motorcycles and 3 million cars owned by the government. Over 8 million Iranians, or roughly 10% of the population, are reportedly employed as taxi drivers via internet platforms. In contrast, Uber employs 8.8 million drivers and couriers globally.
Oil Minister Mohsen Paknejad had earlier told reporters, "It is a start for amending the trend of fuel consumption."
Given that the government evaluates pricing every three months, officials' remarks imply that Iran may pursue more significant price rises in the future.
60-year-old cab driver Mohammad Reza Assadi expressed doubt that any more protests would result in a change.