Iranians hit roads in unprecedented numbers as sanctions bite
ERBIL, Kurdistan Region — Iranians took to the road in unprecedented numbers on Wednesday, the last day of Iranian calendar year, setting a new record by consuming a whopping 135.8 million liters of petrol.
The number for the previous Iranian year was 104.96 million liters, according to official agency IRNA. Trips by train and air are more expensive as the national currency has lost most of its value amid US sanctions.
The level of fuel consumption soars in the beginning of the Iranian new year as Iranians go on holiday for two weeks during Newroz. Since the US government withdrew from the 2015 nuclear deal, the value of the Iranian currency, the rial, has been on a steep curve losing more than 60 per cent of its value.
Supreme Leader Ali Khamenei was defiant in his New Year message to Iranians vowing to continue developing Iran’s defense capabilities and not bow to outside pressure.
“The main problem of the country is the economic problem and the living conditions of poor classes some of these problems have occurred as a result of European and American sanctions and the other part as a result of internal shortcomings and the weaknesses in management,” Tasnim quoted Khamenei as saying.
Luckily, Iran enjoys massive domestic energy reserves.
“Pumping fuel during Newroz is ongoing without a problem,” said Mohammad Reza Mousavi the head of National Iranian Oil products Distribution Company (NIOPDC). “Because in terms of providing fuel to enter 1398 … very good steps have been taken.”
Despite sanctions, Iran has managed to become self-sufficient in its production of petrol. Iran refined 105 million liters per day in 1397, the previous Iranian year that ended March 20. However internal consumption was 87 million liters per day.
Iran used to import 10-20 million per day in previous years to meet the soaring demand for cheap petrol inside the country which is highly subsidized.
Iran became self-sufficient mainly due to the Persian Gulf Star Refinery in southern port of Bandar Abbas.
Khamenei sent a strong message to mark the new year. He said increasing production was the key to saving the economy and declared "national production" the new motto.
"The economy is the country's urgent problem, it's the country's (most) serious and primary problem," he added, mentioning the devaluation of the national currency, the drop in purchasing power and the fall in production as symptoms of the issue.
Iran's President Hassan Rouhani also focused on the economy in his new year. Rouhani had heavily counted on the nuclear deal.
Since the US withdrawal last year, he has been under increasing criticism from his political opponents both for mismanagement of the economy as well as his perceived gullibility in trusting the United States.