Anger over sharp hike in petrol price and rationing scheme sparks demonstrations in oil-rich Iran.

Protests erupted across Iran in recent days after an abrupt decision by authorities to hike petrol prices as part of efforts to blunt the effects of crippling US sanctions on the country’s economy.

The move, announced at midnight on November 15, saw the rollout of a rationing scheme and slashing of subsidies, sending prices soaring by at least 50 percent.

More:

• Hassan Rouhani warns protest-hit Iran cannot allow ‘insecurity’

• In Pictures: Iranians protest against increase in fuel prices

• Iran Supreme Leader Khamenei backs petrol price hike decision

The changes are aimed at raising funds for cash handouts to Iran’s poorest citizens, but many Iranians already grappling with rising inflation were quick to protest against the new policy.

To bring you up to date, here is what you need to know.

What was decided?

The plan was agreed by the Supreme Council of Economic Coordination, which is made up of President Hassan Rouhani, judiciary chief Ebrahim Raisi and Speaker of Parliament Ali Larijani.

The body decided that vehicles for private use would be restricted to 60 litres (16gal) of fuel monthly, while the price of petrol would jump 50 percent to 15,000 Iranian rials ($0.13 at open market rates) per litre. Any fuel purchases in excess of allotted rations will incur an additional charge of 30,000 rials ($0.26) per litre.

Despite the move, petrol remains cheaper in Iran – home to the world’s fourth-largest crude oil reserves – than almost anywhere else in the world. But while a price hike was somewhat expected, many on social media pointed out that average incomes are too low to comfortably absorb the steep hike.

What was the reaction?

The snap move sparked demonstrations in cities and towns across Iran, with drivers abandoning vehicles on highways and protesters blocking roads.

An estimated 87,000 people took part in the protests, according to security officials quoted by the semi-official Fars news agency.

Dozens of banks and stores were set on fire or damaged in violence surrounding the protests and about 1,000 arrests were made. At least two people, including one police officer, were killed.

What’s the background?

Though ostensibly driven by the price hike, the unrest seems to also be driven by widespread dismay over the ailing state of Iran’s economy, in which jobs are increasingly scarce and savings are evaporating amid inflation of more than 40 percent.

Following US President Donald Trump’s decision last year to unilaterally exit a landmark 2015 nuclear accord brokered between Iran and several other world powers – a deal which saw Tehran scale back its nuclear programme in exchange for sanctions relief – Washington has imposed a punishing array of financial measures on the country.

According to the IMF, Iran’s economy is already in “severe distress” and set to contract by 9.5 percent this year as it struggles under the weight of the sanctions.

The downturn has also seen Iran’s currency – the rial – plunge to record lows against the dollar.

What has the official response been?

Iran’s Supreme Leader Ayatollah Ali Khamenei backed the move, saying it was based on expert opinion and should be supported.

Khamenei also labelled protesters taking violent action as “thugs” and accused counter-revolutionaries and foreign enemies of fuelling the unrest. He ordered security forces to “implement their tasks”.

For his part, Rouhani said families would start receiving financial assistance on Monday from the funds raised by the move, also warning that “anarchy and rioting” will not be tolerated.

Internet access has meanwhile been largely cut off across Iran in a bid to smother the protests, with monitoring service NetBlocks saying on Sunday there was a “near-total shutdown” in the country.

In recent years, protests against the state of the economy have been met with a heavy-handed reaction by security forces.

Source: Read Full Article