TEHRAN, Sept 5: Iran's government has requested an extra $3.5 billion from parliament for petrol imports to meet a shortfall caused by lavish daily consumption, the official IRNA news agency reported on Tuesday.

President Mahmoud Ahmadinejad made the request to parliament to cover the shortage of petrol in the remaining months of the current Iranian year ending in March 2007.

Iran may be OPEC's number two producer, but its refineries have a capacity of only 40 million litres of petrol a day in a country where demand stands at more than 70 million litres daily.

The shortfall has up to now been met by spending billions of dollars each year on imports.

In February, parliament approved a $2.5-billion budget for petrol imports, which is expected to run out by late September, because of higher import prices, rising consumption and the smuggling abroad of millions of litres of petrol every month.

There has been talk of rationing and dual-pricing of petrol, which is currently sold for a heavily subsidised price of 800 rials (nine US cents) a litre, but the government decided the country was not yet ready for such measures.

The world's fourth-largest oil producer has now ironically become one of the biggest petrol importers to cover lavish domestic consumption growing at 10 per cent a year. —AFP