Iran is to halt the sale of subsidised petrol from late September as part of plans to phase out subsidies on energy products.

ISNA news agency reported “Based on decisions taken, from the second half of this (Iranian) year (late September), the rationed petrol sales will be stopped,” said Mohammad Royanian, head of Iran’s fuel transportation organisation.

Iranians are currently allocated 60 litres (13 gallons) of petrol a month at a subsidised rate of 1,000 rials (10 US cents). These sales would be stopped, according to Royanian, who did not reveal the new price.

Any other purchase of petrol over and above the rationed quota is at a price of 4,000 rials (40 US cents).

President Mahmoud Ahmadinejad has proposed to phase out subsidies on energy goods that directly or indirectly cost the government as much as 100 billion dollars a year.

His budget proposals for the current Iranian year to March 2011 is marked by the start of a major plan to scrap costly subsidies on energy goods, but economists have strongly criticised the policy as inflationary.