Parliament's Shift in Favor of the Government; Authority Over Gasoline Prices Transferred to the Government

On Thursday, December 21, the newspaper Etemad warned about the future of gasoline prices, stating that the Parliament is no longer strongly opposed to raising gasoline prices and that any decision regarding gasoline and energy carriers has been transferred to the government. Previously, several media outlets and economic experts in Iran had interpreted the statements and positions of some government officials and a number of members of the Islamic Consultative Assembly as a prelude to increasing gasoline and diesel prices as well as gasoline quotas. Etemad called for a clear stance from the government and Parliament, adding: "Changes in the announced policies of officials regarding gasoline pricing have caused public concern." The newspaper referenced statements made last week by Davood Manzoor, head of the Planning and Budget Organization, and Mohammad Baqer Qalibaf, Speaker of the Parliament, who emphasized that there would be no increase in gasoline and other energy carriers in the 2024 budget. However, after the rejection of the overall budget and changes made by the government to this bill, there has been no clarity on this matter. In this context, Rahim Zare, spokesman for the Budget Consolidation Commission of the 2024 Parliament, confirmed that the Parliament has transferred the authority to raise gasoline and other energy carriers' prices for the coming year to the government. According to him, the government has the authority to increase energy carrier prices at its discretion based on the Targeted Subsidy Law. Additionally, it has been noted that given the government's difficulties in providing fuel and budgetary issues for gasoline imports, an increase in gasoline prices is not out of the question. Before the changes in the budget bill, the government was seeking legal authority within the framework of the Seventh Development Plan to increase gasoline rates. Previously, Ahmad Vahidi, the Minister of Interior, stated on December 6, "One liter of gasoline is cheaper than one liter of water," adding that "the low price of gasoline automatically increases gasoline consumption." Accordingly, Mohsen Zanganeh, spokesman for the Consolidation Commission of the Seventh Development Plan in Parliament, wrote on December 14 on his social media account that "the government was obligated in the Seventh Development Plan to maintain energy consumption at the level of 2022 through pricing and non-pricing policies." Experts believe that the most likely option for next year in the gasoline sector is to extend gasoline quotas to all citizens while reducing the quota for vehicles and simultaneously increasing gasoline prices. Meanwhile, the Tasnim news agency reported on December 8 that according to the Seventh Development Plan bill, which has been submitted to the Guardian Council for final approval, from the second year of this plan, i.e., 2025, subsidized diesel will be distributed solely based on mileage and online waybills, and any excess will be subject to gradually increasing consumption taxes. Currently, the price of subsidized diesel is 300 tomans per liter, while the free price is 600 tomans. Some experts have stated that any manipulation of gasoline prices will lead to increased economic pressures and disrupt political and social relations in Iran. The increase in gasoline prices during Hassan Rouhani's presidency in November 2019 led to widespread protests in Iran. In response to these widespread protests, the Islamic Republic resorted to suppressing the demonstrators. In this context, Reuters reported on December 23, 2019, that about 1,500 people were killed during the protests and quoted three sources close to the Supreme Leader of the Islamic Republic, stating that Khamenei had instructed government and security officials to "do whatever is necessary" to stop the protests.