Long queues at gasoline stations across Iran have become a frequent occurrence, reflecting the country’s growing struggle with fuel shortages amid ongoing geopolitical tensions and economic challenges. Residents in cities including Tehran, Isfahan, Mashhad, and Bandar Abbas report waiting for hours, even late into the night, to access gasoline. This trend has intensified in recent weeks as a combination of foreign sanctions, a naval blockade, and disruptions from conflict have constrained Iran’s fuel supply.
Despite Iran’s substantial crude oil reserves, its refining infrastructure has historically been insufficient to fully meet domestic gasoline demand, necessitating imports to cover a shortfall estimated at just over 10 percent of daily consumption. However, U.S. naval operations enforcing a blockade on Iranian southern ports have largely cut off these imports. At the same time, Iranian refineries have experienced reduced output due to strikes and damage attributed to the ongoing conflict involving Israel and the United States. These factors have compounded the supply squeeze.
The U.S. blockade aims partly to pressure Tehran over its control of the Strait of Hormuz, a key maritime passage in the Persian Gulf, which Iranian forces effectively closed early in the war. This has further strained global fuel markets, contributing to rising prices internationally. In response, the United States recently unveiled additional sanctions targeting Iran and associated entities in efforts to compel concessions from the Iranian government.
Despite the worsening situation, Iranian officials have shown reluctance to raise fuel prices, mindful of the unrest that previous subsidy cuts triggered. Significant price hikes in 2019 led to widespread protests met with violence, and nationwide demonstrations occurred earlier this year amid economic grievances. Inflation in Iran has surged to approximately 80 percent over the past year, exacerbated by job losses tied to the war and government-imposed internet restrictions.
Iranian Parliament Speaker Mohammad Bagher Ghalibaf acknowledged the need to lower gasoline consumption but warned against increasing prices, suggesting adversaries seek to exploit such measures to instigate unrest. President Masoud Pezeshkian recognized the damage to oil and gas infrastructure and urged citizens to conserve energy, highlighting his personal efforts to reduce electricity use.
Supreme Leader Ayatollah Mojtaba Khamenei acknowledged economic difficulties but cautioned officials against publicly emphasizing government weaknesses. He warned that foreign adversaries aim to sow division within the country to weaken resistance and threatened national cohesion.
The Iranian government continues to subsidize gasoline heavily, with tiered pricing that offers some fuel at very low cost under strict consumption quotas. Recent weeks have seen reductions in these quotas, forcing many Iranians to purchase more expensive unsubsidized fuel amid long waits at gas stations with limited availability. Officials have indicated they want to avoid a sharp increase in base gasoline prices but may allow higher charges for consumption beyond allotted quotas.
Underlying the crisis are broader structural issues, including widespread fuel smuggling to neighboring countries attracted by Iran’s low prices and inadequate public transportation options in urban areas, leading residents to rely heavily on personal vehicles. Economic analysts have suggested that quota adjustments may alter the distribution of shortages but not their underlying causes.
As Iran confronts these intersecting challenges amid an ongoing regional conflict and international pressure, the government faces a delicate balancing act between maintaining subsidies to avoid social upheaval and addressing persistent supply shortfalls. The situation remains fluid as authorities consider potential policy responses in the face of mounting economic hardship for ordinary Iranians.