Iran will press ahead with plans to raise the price of heavily subsidised gasoline this week, an official said on Sunday, despite suggestions by some officials that the combined price hike and rationing scheme may be delayed.
Iran, which imports 40 percent of its gasoline needs because of a lack of refineries, has said it will limit the sale of cheap fuel from May 22 and also raise the price by 25 percent. The subsidies are draining the oil-rich country's state coffers.
The government says it will help reduce Iran's heavy reliance on expensive imports, particularly when Tehran faces further UN sanctions over its disputed atomic programme.
But with just two days to go before the plan is due to take effect on Tuesday, motorists still do not know how many litres of subsidised gasoline they will be allowed to purchase.
Media reports have also cited hitches in the distribution of the electronic smart cards they will use to buy subsidised fuel.
A spokesman for the government agency responsible for the smart cards made clear in comments carried by the Oil Ministry's Web site Shana that at least the part of the plan concerning higher gasoline prices would go ahead on Tuesday.
"Based on the parliament bill, from this Tuesday each litre of gasoline will cost 1,000 rials (about $1.08) and it will be offered through the use of the fuel smart card," said Mohammad Naseri.
He said those who had not yet received their smart cards would receive emergency cards issued at pump stations. Shana said the government would decide later on Sunday on the amount of rationed gasoline, but this could not immediately be confirmed.
President Mahmoud Ahmadinejad, who came to power in 2005 vowing to share Iran's oil wealth more fairly, had earlier hinted at possible delays, as have other officials.
Analysts say the government, which draws much of its backing from Iran's poor, could get cold feet because the plan may stoke inflation, already running at above 17 percent.
Economists say the subsidies encourage waste, hurt the environment and burden the budget. Iran last year spent $5 billion on gasoline imports. But many Iranians regard abundant gasoline at the current price of 800 rials a litre-among the cheapest in the world- a national right.
World powers have imposed sanctions on Iran for refusing to rein in its nuclear work. The United States has said Iran's dependency on fuel imports gave Washington "leverage".