By Pishtaz | 2026-06-16

Iran is entering another severe summer energy crunch as demand surges and systemic failures collide across its fuel network.

Despite possessing the world’s third-largest proven crude oil reserves and second-largest natural gas reserves, supply stability continues to deteriorate.

Refinery limitations, subsidy distortions, and chronic underinvestment are tightening pressure on an already strained national energy system.

For ordinary Iranians, energy scarcity is no longer seasonal but a persistent condition of daily life.

A heavily subsidised pricing structure has kept domestic fuel artificially cheap while accelerating overconsumption and large-scale smuggling.

It has also deepened fiscal strain on the state and amplified long-term market distortions across the economy.

In November 2019, authorities introduced a tiered gasoline pricing system, sharply raising costs for high-usage consumers and triggering nationwide unrest.

Iran’s electronic smart-card system allocates monthly subsidized fuel quotas, typically between 60 and 100 liters per driver.

Recent reports suggest stricter enforcement, with some stations allegedly instructed to reduce card usage limits further.

In certain cases, distribution has reportedly been restricted to as little as 10 to 15 liters per transaction.

The pressure extends far beyond gasoline into electricity, natural gas, and urban water systems nationwide.

Inflation, corruption allegations, and inefficient state management continue to erode system reliability and public confidence.

Authorities remain wary of major price increases, fearing renewed social unrest across multiple provinces.