Iran pays $30b in energy subsidies in 2020 to rank first globally

Iran remained the single largest provider of energy subsidies across the globe in 2020.

21 September 2021
ID : 33088
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Iran remained the single largest provider of energy subsidies across the globe in 2020.

According to IRNA and based on data from the International Energy Agency, Iran paid $29.7 billion in energy subsidies last year to rank first globally, leaving behind China with $25.5 billion, India with $23.7 billion and Saudi Arabia with $10.9 billion.

Iran spent $69.2 billion and $48.66 billion on fossil energy consumption subsidies in 2018 and 2017 respectively.

In 2020, Iran’s subsidies for natural gas consumption reached $12.2 billion, fossil-fueled electricity $12.5 billion and oil $5 billion. 

IEA data show Iran accounted for 16.2% of the total volume of global energy subsidies that stood at $181 billion worldwide.

In 2020, the fall in fossil fuel prices and energy use brought the value of fossil fuel subsidies down to a record low, as the estimated $180 billion are 40% down from the 2019 level.

Iran is experiencing the most significant increase in subsidies for fossil fuel-based electricity, alongside Venezuela, Mexico, Egypt and China.

Referring to electricity subsidies in 2020, IEA put it at $50 billion, 25% of which were paid in Iran.

In the natural gas sector, the situation is much worse for Iran. Close to $35 billion were granted globally in natural gas subsidies last year, of which 40% were paid in Iran.

Iran’s natural gas consumption increased by an estimated 3% in 2020, with most of the growth in the power generation and residential sectors. 

Although gas production is estimated to have increased by 2% due to the ongoing development of the South Pars Gas Field off the Persian Gulf, net exports fell by 2-3 billion cubic meters, as deliveries to Turkey dropped in Q2 due to a pipeline explosion and exports to Iraq were temporarily cut back in December 2020 as a result of payment disputes.

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