The Iranian government has authorized the unsubsidized imports and sale of unleaded gasoline in the country as part of efforts to reduce the size of subsidies given to motorists.

Iranian government spokeswoman Fatemeh Mohajerani said on Tuesday that legal entities authorized by Iran’s Oil Ministry will be able to import unleaded gasoline using their own hard currency resources.

Iranian Oil Ministry’s fuel distribution company (NIOPDC) said hours later that unleaded gasoline imported by companies will be available to motorists at unsubsidized prices.

NIOPDC’s CEO Karamat Veis Karami said arrangements for choosing importers and the selling price of the fuel will be decided later.

Iran has the cheapest fuel prices in the world. The price of octane-95 gasoline is 15,000 Iranian rials ($0.022) per liter for a monthly quota of 60 liters while motorists are able to fill up their tanks at double that price for almost unlimited amounts.

Unleaded gasoline, which has an octane rating of above 95, has been available at a price of 35,000 rials (nearly $0.05) in Iran in recent years although its supply has been limited to few gas stations in large cities.

A syndicate spokesman said that the price of unleaded gasoline imported from abroad could be around prices used in the Arab countries in the Persian Gulf where a liter of gasoline is sold for around $0.6 or higher.

The Tasnim news agency said in a report on Tuesday that the decision to authorize the imports and sale of unleaded gasoline in Iran is part of efforts to gradually ease the burden of huge subsidies given to motorists.

It said the decision will allow the government to save up to 200 trillion rials (nearly $300 million) it pays per year as a subsidy for unleaded gasoline.

The report said that as of next calendar year starting in late March, the government will also stop paying jet fuel subsidies to airlines to save nearly $1 billion in annual budget expenditures.

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