More than 105 million cubic meters of gas is said to be extracted daily from phases 1-5 of the South Pars project.

Iran sits on the world’s second largest proven gas reserves after Russia.
Official estimates say production from the world’s largest gas field, South Pars, has exceeded 100 million cubic meters per day.
Shared with Qatar, the field is said to hold almost 14.2 trillion cubic meters of reserves--equal to seven percent of the world’s total and 38.6 percent of Iran’s reserves. South Pars has been divided into 25 phases on the Iranian side.
More than 105 million cubic meters of gas is said to be extracted daily from phases 1-5 of the South Pars project.
Nevertheless, a leading crude oil producer like Iran is facing a growing shortfall in supplies of vehicle fuel, with heavily-subsidized petrol (gasoline) consumption reaching 70 million liters a day.
Average consumption has reached 66 million liters, compared with a daily output by Iran’s refineries of some 39 million liters, obliging the government to import the rest at an annual cost of nearly $2 billion.
Despite a 23 percent price hike for the Iranian year that started March 21, prices are still only 800 rials (less than 10 US cents) a liter for standard, lead-free petrol and 1,100 rials for super.
This is close to 2.5 times less than the refinery price, with the difference being made up by subsidies totaling up to 3.5 billion dollars a year.
This not only makes for heedless consumption in a country with inadequate public transportation and a large number of old and uneconomical cars, but massive smuggling of fuel to neighboring countries, said a report in the Persian daily Donyay-e Eqtesad.
The government is unwilling to raise the price again but is considering other steps along with appeals to cut down on fuel use.

Waste
Iran’s domestic oil consumption, 1.4 million barrels per day in 2003, is increasing rapidly as the economy and population grow. Iran subsidizes the price of oil products heavily, to the tune of $3 billion or so per year, resulting in a large amount of waste and inefficiency in oil consumption.
The government also is forced to spend over $2 billion per year to import oil products (mainly gasoline) which it cannot produce locally.
In spring of 2004, as part of an effort to curtail the rise in gasoline subsidy expenditures, gasoline consumption and imports (both of which are growing rapidly), Iran’s parliament voted to more than double gasoline prices, to around 95 cents per gallon.
Currently, Iran’s gasoline prices are amongst the cheapest in the world. In November 2003, Iran announced that it might even be forced to start rationing gasoline.
Subsidies, especially those that encourage the production and use of fossil fuel, and other non-renewable forms of energy, are harmful to the environment. They can also have high financial and economic costs, and often only bring few benefits to the people for whom they are intended.
Removing, reducing or restructuring such energy subsidies is helpful for the environment and the economy at the same time.
Potential social costs in terms of employment in the conventional energy industry or reduced access to energy could be addressed by redirecting the money formerly spent on subsidies to income support, health, environment, education or regional development programs.
These days, the efficient use of available energy is becoming more and more important for industrial firms throughout the world.
Iran is behind many countries in energy efficiency. As a result, energy subsidy has been one of the pressing issues highlighted at various official meetings.

Domestic oil consumption, 1.4 million barrels per day in 2003, is increasing steadily as the economy and population grow.

Futile
What is evident is that policies such as raising the prices and allocation of subsidies have proved futile in alternating energy consumption patterns.
Cheap and inexpensive fuel prices have made the officials and the people inattentive and apathetic about efficient energy consumption.
Many might be of the view that if cheap fuel and energy is put at the disposal of the public, it will lead to more economic growth and development, though there is solid evidence to prove that with inexpensive fuel nobody will pay sufficient care and attention to saving, conserving and using energy efficiently. This in turn is highly destructive and detrimental to the national economy.
Energy subsidies do not benefit lower income families but only lead to squandering of national wealth and creating horrendous traffic and air pollution problems. In fact, there is need for a distinct pricing method for different energy byproducts (concordant with their scarcity, and availability) such as gasoline fuel, kerosene, diesel fuel, heating oil, etc.
Bad energy pricing methods together with ineffective polices have hampered investment efforts for the supply, production and distribution of sufficient energy by-products. In addition, low fuel prices have led to the squandering and waste of a great deal of the country’s energy resources, even though they could have been sold in the international markets at much higher prices.
The transportation system in our cities is intolerable and illogical, mainly due to low and cheap petroleum.
City transportation should be mainly via buses and subways (metro). Regrettably, in our country’s metropolitan areas, the bulk of transportation is by personal vehicles, which are in most cases much older models with high fuel consumption rates that at the same time pollute the air in an alarming rate and create nightmarish traffic jams.
Current policies on energy prices are tantamount to throwing away oil resources. For instance, since the price of energy byproducts in Iran are so illogically low, the revenues generated by one of our refineries is not even sufficient for the said refinery to rehabilitate and repair its existing facilities.
In fact, if the state does not lend assistance and help to invest in refineries, all refinery operations inclusive of maintenance, repair and increasing production capacity will face major difficulties.
What kind of fuel pricing policy is this, when it cannot even cover the basic operation and investment costs of the oil energy industry?
Seeking alternative resources and raising awareness on ways of saving energy are the remedies. Is this too much to ask?

The main audience for the national charter of investment security is the common people and the private sector, which often shy away from investing in productive economic activities.

The government’s plan to devise a national charter on “Investment Security“, has come a bit late, but better late than never, says a commentary in Donyaye Eqtesad.
Concerns about absence or lack of investment security are not just limited to the state-run sector. Since the public sector has access to financial resources and facilities, as well as other incentives and privileges granted by the government, it certainly does not need further investment security.
Most of the investments by the public sector in the economy are essential and in line with the programs of the government. Hence, the main audience for the national charter of investment security is the common people and the private sector, which shy away from investing their capital in economic activities given the quick changes in and uncertain policies of the government.
But surprisingly, in devising such an important national economic document, opinion of the private sector has not been included. Such a national charter, which representatives from the three branches of the government have planned to devise to ratify economic policies on investment security, will be half-baked in the absence of the private sector.
The views of the private sector before planning the national charter have not been taken into consideration. Therefore, it is wrong to assume that the plan will resolve the problems and ailments of the private sector overnight.
The Iranian Constitution has divided the economy into three sectors of government, private and public or cooperative.
The role of the state-run sector in economy has largely expanded over the past decades at the cost of marginalizing the private sector with little or no role. This is a point that has even been admitted by high-ranking government officials, who are making every effort to create a balance between the two, including devising the investment security charter.
Therefore, it is necessary to make reforms in the structure of the committee, which is in charge of devising the national charter of investment security and also restore the rights of the private sector in this respect, by its inclusion.
The only way to prove that the national charter of investment security is not tarnished with empty slogans is by incorporating the views of the private sector in the national charter and getting all establishments and organizations to collaborate with each other when implementing the plan.