Hamid Mollazadeh
As winter approaches in Iran, the country finds itself confronting a familiar and increasingly urgent dilemma: soaring household demand for natural gas and a supply system struggling to keep pace.
With consumption in the residential sector now surging to record levels, energy authorities have begun reducing—if not outright cutting—gas deliveries to power plants, heavy industries and the petrochemical sector.
The resulting disruptions threaten not only electricity generation but also industrial output, export revenues and public health, raising the question of whether Iran can avoid another season of widespread shortages.
The roots of the crisis lie in a structural imbalance that has grown sharper over time. Iran is the third-largest producer of natural gas in the world, yet domestic demand has expanded so quickly that production can no longer meet winter peaks.
Today, natural gas accounts for nearly 70% of Iran’s entire energy mix, powering homes, factories, electricity generation and even sections of the transportation sector.
Overwhelming Reliance
This overwhelming reliance on a single fuel source leaves the country exceptionally vulnerable to seasonal shocks. When the temperature drops, household consumption balloons—often surpassing 700 million cubic meters per day—forcing authorities to divert gas from power plants and industrial facilities.
This shortage reverberates across multiple sectors. Powerplants, deprived of sufficient natural gas, increasingly resort to burning mazut and other heavy fuels.
While these alternatives keep turbines running, they impose a staggering environmental and health cost. Cities such as Tehran, Arak and Isfahan frequently choke under toxic haze, with pollution levels spiking whenever mazut burning intensifies.
Medical experts warn of rising respiratory illnesses and premature deaths linked to winter pollution episodes—an avoidable consequence of fuel shortages and the absence of long-term energy planning.
Industries and petrochemical complexes, many of which rely on stable gas feeds as both fuel and feedstock, face a different set of challenges. Gas cuts disrupt production cycles, reduce output and damage equipment not designed for intermittent operations.
For Iran’s petrochemical sector—a major source of non-oil export revenue—such interruptions translate into lost income at a time when the country can ill afford economic instability.
Steelmakers, cement plants and refineries experience similar setbacks, often being instructed to limit operations or shut down during peak winter demand.
Deeper Issues
The winter crisis mirrors the summer electricity crisis, reflecting deeper structural issues: fast-growing consumption, aging infrastructure, delays in developing new gas fields and persistent policy mismanagement.
Despite repeated warnings from energy economists, investment in upstream gas production has lagged, and pricing policies continue to encourage excessive household demand. Ultra-subsidized gas tariffs mean that consumers have little financial incentive to conserve energy, pushing winter consumption to unsustainable levels.
Iran’s predicament underscores the need for a long-term strategy. Experts argue that reforms must include tariff restructuring, accelerated development of new gas fields, diversification of the energy mix toward renewables, and improvements in energy efficiency—particularly in buildings, which account for a large share of winter gas use.
Until such reforms take shape, Iran will remain caught in a recurring cycle: soaring winter demand, forced cuts to industry, increased mazut burning, rising pollution and mounting economic losses.
For now, natural gas remains on the edge—stretched between the needs of households and the demands of an industrial economy that cannot function without stable energy supplies.
The question is no longer whether shortages will occur, but how severe their impact will be on Iran’s economy and public health this winter.