Iran Cuts Energy Subsidies as Sanctions Take Toll

Iran started phasing out energy subsidies and replacing them with cash payments to the poor, under a five-year plan promoted by President Mahmoud Ahmadinejad as an “economic revolution.”

Ahmadinejad said the changes would lead to a better distribution of wealth, state-run Press TV reported today. The price supports totaled about $4,000 a year for a family of four, more than the income of many Iranians, and turned the nation into “one of the most wasteful” for energy consumption, the International Monetary Fund has said. The Central Bank put the cost of the energy subsidies alone at $40 billion to $100 billion a year, depending on oil prices.