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Source: http://www.timesonline.co.uk/tol/news/world/middle_east/article1803513.ece
Ahmadinejad and the Petrol Paradox
[Times-UK] Michael Theodoulou - OPEC's second biggest oil exporter is venturing into the controversial territory of petrol rationing. Petrol consumption in Iran far outstrips the capacity of Iranian refineries, forcing Iran to import billions of dollars worth of petrol at international prices. It is then sold to the motorist at prices so heavily subsidized that a liter of fuel is cheaper than a liter of mineral water. This has encouraged wastefulness and smuggling abroad - and has placed a huge burden on the national budget. Under the rationing scheme, prices are due to rise to about 11 U.S. cents a liter. "When you pursue a confrontational foreign policy, not only do you not have foreign investment but you have capital flight: the average Iranian businessman is more apt to put his money in Dubai or Turkey," said Karim Sadjadpour, of the Carnegie Endowment for International Peace in Washington. "In terms of undermining the Iranian economy, the U.S. feels that Ahmadinejad is their great ally."