Iranian President Masoud Pezeshkian said on Thursday there is no doubt that gasoline prices must rise, signaling that long-anticipated fuel reforms are moving closer despite fears of renewed public unrest.
Speaking during a visit to West Azarbaijan province, Pezeshkian acknowledged that raising fuel prices is unavoidable to address Iran’s worsening energy shortages but cautioned that any decision would require “careful planning” to avoid deepening economic hardship.
“There is no question that gasoline must become more expensive,” he said, according to state media. “But it is not a simple decision. We cannot act overnight or create more difficulties for people.”
His comments came amid intensifying debate over Tehran’s plans to introduce a new pricing system aimed at curbing soaring fuel consumption and smuggling.
Over the past two weeks, Iranian media have reported that the government is reviewing several reform scenarios, including multiple pricing tiers and possible changes to fuel quotas.
Last week, Khaneh Eghtesad published what it said was a leaked cabinet decree outlining a roadmap for “gradual correction” of gasoline prices. The government initially denied the report but later confirmed that the issue was under study by cabinet working groups.
Cabinet secretary Kamal Taghavi-Nejad said this week that fuel reform had been discussed but “no final decision” had been taken. A lawmaker, Amirhossein Sabeti, said the debate over introducing three fuel price tiers had become serious in parliament.
Energy officials say domestic gasoline consumption has surged well beyond refining capacity, forcing costly imports and draining subsidies that analysts estimate at more than $30 billion annually.
Pezeshkian has pledged to overhaul Iran’s energy subsidy system, arguing that maintaining the current artificially low prices is unsustainable. “Even water costs more than gasoline in Iran,” he said earlier this week.
The last major fuel price hike in November 2019 sparked nationwide protests that were met with a violent crackdown. Rights groups and Reuters reported that at least 1,500 people were killed.
Officials have since stressed that any future reform would be gradual and paired with compensation measures for low-income households. The administration insists it will not repeat the sudden price shock of 2019.
Economists warn that aligning prices with real production costs could sharply raise inflation but may also help reduce smuggling and waste. The government is expected to unveil its energy reform framework before submitting next year’s budget in December.
