More than $1 billion-worth of gasoline and other oil products is smuggled out of Iran each year, the government spokesman said on Monday, criticising parliament for maintaining heavy fuel subsidies. Iran's hard-line-dominated parliament, which draws support from the poor, voted this month to maintain fuel subsidies that keep Iran's petrol prices among the lowest in the world at just 10 cents a litre for another year.
Under a five-year economic plan developed by the pro-reform government, petrol prices were due to rise gradually to international levels from March 2005.
"Each year, more than five billion litres of fuel and oil products are smuggled out of the country," Abdollah Ramazanzadeh told a weekly news conference.
"It costs the state 1,000 billion tomans ($1.13 billion)," he added.
The difference in gasoline prices between Iran and its neighbouring countries has initiated large-scale contraband of the product through to Pakistan, Afghanistan, Iraq and Turkey.
Ramazanzadeh said President Mohammad Khatami's government wanted to kill off the motive behind the billion-dollar business, but the parliament's ruling had paralysed the move.
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