Fars news agency reported that Iran increased Tuesday gasoline prices by some 25 percent, but delayed rationing of fuel. The gasoline prices increased from 800 rials (0.086 dollars) to 1,000 rials (0.108 dollars) per liter for normal and 140 rials (0.151 dollars) for “super� gas.

"From May 22, petrol will be distributed only on production of rationing cards, but at the same price, 800 rials a litre ($0.08)," said Mohammad Jafar Behdad from the presidential press office.

Tehran residents formed long queues on Monday night in front of gas stations to fill their cars before the price increase.
President Mahmoud Ahmadinejad initiative to stop the large fuel consumption, which currently reaches some 73 million liters a day, is to be imposed from Tuesday. Gasoline is to be supplied only through so-called “smart cards� or gas coupons. A daily ration of three liters for private cars and 15 to 20 liters for taxis is to be sold at 10 cents per liter. Anything above those quotas is to be sold at 30 to 40 cents per liter.

Oil Minister Kazem Vaziri Hamaneh said the details of the rationing plan would now be announced on June 7, according to the ISNA news agency.

With this move, Ahmadinejad hopes to solve Iran’s budget problem and also decrease traffic congestion and air pollution in big cities. Although Iran has a daily oil production of 4.2 million barrels, the Islamic state still spends 5-8 billion dollars yearly for gasoline imports due to lack of refineries.

Although smart card machines have been installed at almost all gas stations, due to lack of the necessary software the cards cannot yet show the consumption volume.