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News number: 8805111184

16:02 | 2009-08-02


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Official Downplays US Boycott on Iran's Gasoline Supplies

TEHRAN (FNA)- Iran has no reason to worry about a possible sanction by the US on the supply of gasoline to the country, an Iranian official underlined on Sunday.

"People should not be worried about imposition of sanctions as domestic production of gasoline is increasing and the volume of imports is decreasing," the Fuel and Energy Director of the Fuel Transportation Management Headquarters, Amir Reza Rajabi, told FNA.

"We will be self-sufficient in the production of gasoline in the near future," Rajabi added.

Iran is the world's fourth-largest exporter of crude oil but due to the lavish consumption of heavily subsidized fuel by Iranian drivers, the country cannot meet the domestic gasoline needs, and is forced to import large amounts which it then sells very cheaply at the pump, burdening the budget.

Iran's government started rationing gasoline in June 2007 and is scrambling to boost the country's refining capacity and tamp down domestic demand through other measures, including replacing gasoline-consuming car engines with gas-powered engines.

Asked to comment on a recent bill approved by the US Senate to impose sanctions on gasoline supplies to Iran, Rajabi said that the US has been striving for over four years to impose sanctions on Iran's gasoline supplies but to no avail.

He expressed optimism that the sanctions would prove inefficient, given the measures Iran has adopted in recent years to confront possible boycotts on its fuel supplies.

In an attempt to force Tehran to halt its enrichment program, the US Senate has voted to put pressure on companies selling gasoline to Iran.

A bill approved on Thursday by the Senate says companies that continue to sell gasoline and other refined oil products to Iran will be banned from receiving Energy Department contracts to deliver crude to the US Strategic Petroleum Reserve.

The measure must now be reconciled with a similar bill passed by the House of Representatives.

In June, a committee in the US House of Representatives voted to target Iran's gasoline imports and its domestic energy sector. Iran imports some 40 percent of its gasoline needs.

The House Appropriations Committee approved by voice vote a measure prohibiting the US Export-Import Bank from helping companies that export gasoline to Iran or support its production at home.

The measure is aimed at pressuring Iran into relinquishing its nuclear program, which the US and the West allege has military purposes.

Tehran, a signatory to the nuclear Non-Proliferation Treaty, has repeatedly rejected the claim, saying that nuclear weapons do not fit in its defense paradigm.

The US Energy Department had previously awarded contracts to supply crude to the US reserve to three of Iran's gasoline suppliers, namely Vitol, Royal Dutch Shell Plc and Glencore.

The US Congress created the emergency petroleum reserve in the mid 1970s and the stockpile is holding some 724 million barrels of crude at four underground storage sites in Texas and Louisiana.