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Billions Of Dollars Of Subsidized Gasoline Being Smuggled Out Of Iran

File photo - Iranian drivers fill their tanks at a gas station in the capital Tehran, November 5, 2018

A top anti-smuggling official in Iran has said that around 11 million liters or close to 3 million gallons of gasoline is smuggled out of the country on daily basis, according to Fars news agency

This is more than 10% of the daily fuel sold to drivers in the country.

Iran offers the cheapest fuel for vehicles in the world according to International Energy Agency, with gasoline at around 7 US cents a liter, or 25 cents a gallon.

Compared to neighboring countries, there is a huge price difference, which makes smuggling the gasoline a lucrative business. Authorities have not offered an explanation as to how such a huge volume of gasoline can be smuggled out, without being detected.

The cheap price is the result of huge government subsidies to the tune of approximately $45 billion a year. If 10 percent of all subsidized gasoline is smuggled out, it means $4.5 billion of public money is pocketed by those who are involved in the scheme.

Last year, President Hassan Rouhani’s government charged that gasoline smuggling is taking place at a much larger scale, with 20-40 million liters daily. The anti-smuggling authorities disagreed, saying it is around 11.5 million liters.