Economy

Tehran Freezes Gasoline Prices Despite Rising Fiscal Strain

Iran’s government has officially announced that there will be no increase in gasoline prices, either for the subsidized or free-market categories, despite mounting economic pressure and rising import costs.

Government spokesperson Fatemeh Mohajerani confirmed that the subsidized gasoline price will remain at 1,500 tomans (about 1.5 cents per liter), while semi-subsidized gasoline stays at 3,000 tomans (around 3 cents per liter). This pricing structure, among the lowest in the world, has remained unchanged since 2019 despite a sharp depreciation of the national currency and growing fiscal strain on the government.

Mohajerani acknowledged that Iran is now importing several million dollars’ worth of gasoline daily, a striking reversal for a country that once prided itself on fuel self-sufficiency. She emphasized the need to better manage foreign currency resources linked to gasoline while improving public welfare, industrial development, and national infrastructure.

Although the official stance rules out any immediate fuel price hike, the current system is economically unsustainable. With domestic consumption soaring and refining capacity stretched, the gap between domestic and global fuel prices continues to widen, encouraging smuggling and inefficiency.

Analysts note that while freezing fuel prices may temporarily calm public sentiment, it could deepen long-term economic imbalances. As one of the world’s cheapest gasoline markets, Iran faces the difficult choice between maintaining social stability and confronting the fiscal burden of massive fuel subsidies.

The government’s latest reassurance may buy time politically—but the real cost of cheap fuel is steadily rising.