Iran oil 248.88.
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The Iranian parliament has approved a bill submitted by Iranian President Mahmoud Ahmadinejad to scrap the country's economic subsidies and instead redistribute the money in the form of cash allowances, the official Iranian TV station Press TV reported.
The bill is part of the government's plans to tackle the country's economic problems, chiefly among them the ever-increasing inflation, which currently stands at an estimated 30 percent.
The money saved on the new reform is to be spent on creating job opportunities, expanding the public transportation system and increasing non-oil exports, according to Press TV.
Iran, the second-largest oil producer in the Organization of Petroleum Exporting Countries (OPEC) after Saudi Arabia, depends heavily on its income from oil to provide extensive subsides on goods ranging from oil and gas to food for its population.
However, as the price of oil has fallen from approximately $150 a barrel six months ago to below $40 today, the government has come under growing pressure both to maintain the subsidies and to fight the growing inflation.
The deputy director of the Iranian Central Bank, Ramin Pashaifam, was quoted by Etemad newspaper as saying that if the plan were to be implemented, then the price of vital supplies such as gasoline and electricity would dramatically increase and inflation would rise by a further 11 to 15%.
Ahmadinejad has in the past tried to calm concerns about the impact of the falling price of oil on the country's economy by saying that the country could survive for three years even if the price were to drop to zero.
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