Iran, the second largest crude producer among the OPEC members, will introduce petrol rationing for motorists from Wednesday.
"From midnight tonight gasoline will be rationed," state television said on Tuesday quoting a statement from the oil ministry.
Despite its huge energy reserves, Iran lacks refining capacity and has to import about 40 per cent of its petrol needs, a sensitive issue when world powers have threatened fresh sanctions over a row with Tehran over its nuclear programme.
At least one gas station was set on fire in protest:
Iranian youths have set fire to a Tehran petrol station in protest after the government introduced fuel rationing.
The BBC has a little more extensive coverage:
Several petrol stations have been torched in the Iranian capital Tehran, after the government announced fuel rationing for private vehicles.
Windows were smashed and stones thrown at the stations, and there was traffic chaos as motorists queued to buy fuel.
Iranians were given only two hours' notice of the move that limits private drivers to 100 litres of fuel a month.
There was violence in nine areas of Tehran as angry youths attacked petrol stations, Raja News, a website linked to Iranian President Mahmoud Ahmadinejad, reported.
Reports of attacks on petrol stations elsewhere in the country could not be confirmed.
Some people came on foot with jerry cans and plastic bottles and the police were out in force to stem unrest, amid reports of scuffles at petrol stations.
There is anger and frustration the government did not give people more notice. Some MPs have called for an end to the rationing and parliament may postpone its summer recess to deal with the crisis.
"Guns, fireworks, tanks, [President] Ahmadinejad should be killed," chanted angry youths, throwing stones at police.
The protests are the first large-scale outpouring of anger against the Iranian government since Mr Ahmadinejad took office in 2005.
I'm not going to go overboard here and say that the Iranian government is going to fall because of this but I once read that America is three hot meals from a revolution, that theory probably applies most places. It is just a question of what is going to be the lever that pushes people past the tipping point.
It probably doesn't help that the Iranians can turn on their TV and see people in America, the most hated country on Earth, driving all they want.
Iran, Oil, Politics