Sunday, March 22, 2009

Oil prices at the pump (in Iran)

I originally wrote this entry on August 17, 2004 and published it on

Gas pump on the Isfahan-Saveh road. July 2004.

The price, listed on this gasoline pump, is in Iranian Rials. In July 2004, when this picture was taken on the road from Isfahan to Saveh, 8600 Rials could be exchanged for about $1. The total price, seen in this picture, is for 5.07 liters. That's about 1 + 1/4 of gals for less than 50 cents.

As you can see, in Iran gasoline is priced sharply under the world markets. The social and economic reasons are subtle. In very brief terms, this is primarily a way for the government to subsidize the national economy. Other oil derivatives which require higher-level processing are traded at world market prices and are normally produced by companies listed on the Tehran Stock Exchange.

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