Iran Considers Fuel Price Hikes Amid U.S. Economic War

President Masoud Pezeshkian acknowledged on Sunday that Iran is facing serious domestic difficulties and many problems in society resulting from a full-scale economic, military, and security war. He attributed these hardships to a new round of sanctions and a seaport blockade implemented by U.S. President Donald Trump, who has threatened the most crushing economic operation ever undertaken against any country to force the collapse of the Iranian regime.

To stabilize an economy where the rial has hit a record low of 2 million per U.S. dollar, the Iranian government is preparing to increase fuel prices. Pezeshkian noted that current subsidies are a significant financial burden, with the lowest price tier costing less than one cent per litre against a production cost of 65 cents. The administration is weighing three options: a first-come, first-served system, a monthly fuel quota for all citizens, or full price liberalization to approximately 44 cents per litre.

These potential hikes follow a failed pilot program for price liberalization in Kerman province, which was cancelled at the last minute. While First Vice President Mohammad Reza Aref argued for maintaining the cheapest fuel tier, the International Monetary Fund predicts Iran's GDP will contract by 5.4 percent in 2026. Pezeshkian stated his government is striving to overcome inflation and unemployment to ensure citizens can live with dignity.