Iran rolled out a fresh pricing bracket on Saturday for its state-subsidised gasoline, marking the first adjustment to curb runaway expenses since a 2019 price surge that ignited countrywide protests and a brutal response killing over 300 people.

Generations in Iran have regarded inexpensive gasoline as an inherent entitlement, triggering massive unrest dating back to 1964 when a fare rise compelled the shah to deploy army vehicles to substitute for those of protesting cab drivers.

Iran's clerical regime now grapples with mounting pressure from the swiftly weakening rial and sanctions tied to its atomic activities.

This has inflated the expense of maintaining some of the globe's cheapest fuel at mere pennies per gallon. Yet the authorities' cautious step to raise rates probably indicates a desire to sidestep clashes with a weary populace following Israel's 12-day assault on the nation in June.

“Our discontent has no result,” fumed Saeed Mohammadi, a teacher who works as a taxi driver in his spare time to make ends meet. “The government does whatever it likes. They don't ask people if they agree or not.”

Saturday's updated framework introduces a third tier to the longstanding subsidy regime. Drivers can still access 60 litres (15 gallons) monthly at the subsidised 15,000 rials per litre, or 1.25 US cents, with the following 100 litres (26 gallons) holding steady at 30,000 rials a litre, or 2.5 cents.

Volumes exceeding that threshold enter the new rate of 50,000 rials per litre, roughly 4 cents. Iran launched fuel quotas in 2007, yet demand for the rock-bottom gasoline persists unabated.

Even under this elevated level, Iran's pump prices rank among the world's lowest.

The gap between production and delivery costs versus retail price constitutes the subsidy borne by the Iranian state. The Paris-based International Energy Agency listed Iran in 2022 as bearing the planet's second-largest energy subsidy burden, trailing only Russia, with oil subsidies hitting $52 billion that year; officials admit tens of billions annually prop up suppressed energy costs.

Tehran economist Hossein Raghfar observed that gasoline prices have surged 15-fold since 2009, casting a grim light on subsidy efficacy.

”Not only did it fail in lessening the budget deficit, but it also trapped the country's economy in a negative loop of inflation and budget deficit,” he said.

Hamid Rezapour, a 35-year-old bank teller, opined that Iran's leadership had “no choice except to increase the price to manage the country's economy.”

“It needs more money to pay for public needs,” he said. “To me, it is an indirect tax, though in a messy economy it barely works.”

This adjustment represents the boldest overhaul to Iran's fuel subsidies since 2019, when an abrupt 50% rise in base rates and a 300% spike for excess volumes unleashed protests nationwide.

Riot police quelled unrest across 100 cities and towns, where some demonstrators torched fuel stations and banks. The ensuing suppression claimed at least 321 lives, per Amnesty International, with thousands arrested.

Detractors warn that each 10,000-rial gasoline hike could fuel up to 5% inflation amid the country's 40% annual rate.

Yet bargain fuel sustains jobs: Iran boasts 25 million vehicles, including 3 million public and state-linked autos, plus 6 million motorcycles. Over 8 million Iranians reportedly drive taxis via apps, nearly 10% of the populace; Uber counts 8.8 million drivers and couriers globally.

“It is a start for amending the trend of fuel consumption,” Oil Minister Mohsen Paknejad told reporters previously.

Remarks from officials hint at potentially sharper hikes ahead, with tri-monthly price reviews underway.

Taxi driver Mohammad Reza Assadi, 60, expressed doubt that fresh outrage would alter outcomes.

People poured into the streets over hiking the gasoline price in the past, he said, “but they returned home tired and hopeless later at dusk.”

With inputs from PTI