News & Reports News Year 2011 January , 2011 'Subsidy reforms halt fuel consumption'

'Subsidy reforms halt fuel consumption'

Iranian Deputy Economy Minister Mohammad Reza Farzin says fuel consumption has fallen across the nation since the government began subsidy cuts on energy.

"In the past nine days, our petrol consumption, which was about 60 million liters a day, is now at 55 million," Farzin said in an interview with AFP on Monday.

"The oil ministry says that diesel consumption, which was at 54 million liters, is now at 40 to 41 million liters," he noted.

President Ahmadinejad's administration began cutting subsidies on sensitive energy and food items from December 19, ruling out claims that the move could spark severe inflation.

"We are returning the income generated back to the people. We are not creating more cash. So our plan will not increase inflation," the minister said in defense of the plan.

"We are spending 100 billion dollars in subsidies every year from a gross domestic product of 400 billion dollars. We have realized that low energy prices cannot deliver social welfare," Farzin stated.

“We are determined to use the resources for managing prices more efficiently," said Farzin who is in charge of the subsidy cuts.

The country's economic reform plan is one of the most important undertakings in Iran's recent .
(press tv)