A Member of Parliament: This Year We Need to Import Two Billion Dollars Worth of Gasoline

A member of the Iranian Parliament reported a deepening energy imbalance in Iran and claimed that this year there is a need to import two billion dollars worth of gasoline. Gholamreza Dehghan Nasrabadi said on Friday, July 1st: "It is predicted that this year we will have more than two billion dollars in gasoline imports, which is approximately equivalent to the construction of a refinery with a capacity of 100,000 barrels per day." Iran has faced a gasoline shortage since last year due to the government's inability to build new oil refineries. An official document from the Ministry of Oil, recently obtained by Radio Farda, shows that last year the production of gasoline from the country's refineries only grew by 1.5%, while the growth in gasoline consumption was 10.5%. The significant increase in gasoline consumption is attributed to the entry of one million domestically produced cars with low efficiency into the market. To compensate for this shortfall, the government has mixed large amounts of petrochemical and chemical materials into the gasoline produced by refineries, resulting in a 280% increase in the chemical composition of the gasoline produced in the country over the past three years. In fact, according to the Ministry of Oil document, last year's gasoline production from the country's refineries reached just over 97 million liters per day, but the government mixed a huge volume of aromatic materials, chemicals, and gasoline produced from petrochemicals with gasoline, increasing the volume delivered to fuel stations to over 111 million liters per day. The country's gasoline consumption also exceeded 115 million liters, with the remaining shortfall covered through imports or barter of mazut with gasoline. Data from the Ministry of Oil document shows that only one-fourth of the gasoline produced in the country meets Euro 4 and Euro 5 standards. Mr. Dehghan Nasrabadi continued his remarks by stating that this year we are also facing a diesel shortfall. According to the mentioned official document, Iran's diesel shortfall began last year, with a daily shortfall of 1.5 million liters in 1402 (2023), which has been covered through imports. Iran is also facing a huge gas shortfall in winter and a significant electricity imbalance in summer. Recently, the Deputy Minister of Industry, Mine, and Trade announced in a letter to the Minister that from the beginning of summer, electricity delivery to steel and cement industries will be halved. Iran's steel industry requires 5,500 megawatts, and the cement industry requires 1,000 megawatts of electricity. Iran has electricity losses in its outdated transmission and distribution network equivalent to the electricity consumption of the steel sector, which could cover a significant portion of its electricity shortfall if modernized; however, no significant action has been taken in this regard over the past two decades. In terms of gas losses, Iran ranks second in the world after Russia, and Mr. Dehghan Nasrabadi also pointed this out, stating that approximately 18.5 billion cubic meters of associated gas is burned in flares annually, and assuming an export price of 30 cents per cubic meter for Iranian gas, the country incurs an annual opportunity cost of over 5.5 billion dollars. This statistic aligns with reports from the World Bank and the International Energy Agency. Iran needs only 5 billion dollars in investment to prevent flaring, but this has not been done in the past two decades. Gholamreza Dehghan Nasrabadi further stated that the issue of energy imbalance has two significant consequences and risks for the country: first, the country's energy security is jeopardized, and second, the production of the country's industries decreases, leading to a reduction in foreign exchange earnings and an increase in foreign exchange consumption.