The dynamics of substitution tensions between fossil energy carriers for gas consumption in Iran's transportation sector on the horizon of 2025

The present paper explains the dynamics of substitution tensions between fossil energy carriers for gas consumption in the transportation sector of Iran in the horizon of 2025 using seasonal space model and Kalman filter approach for the years 2006-2019 in the form of quarterly data. Based on the results; Price elasticity and revenue elasticity of gasoline and gas oil are -0.20, -0.15, 0.27 and 0.41, respectively. Income elasticity of products indicates that gasoline and gas oil are normal commodities. Also, the price elasticity of both products is less than one. Among the important factors in the low price elasticity of gasoline and gas oil with gas consumption in the transportation sector of Iran can be; Searched for supply and demand. On the supply side, we can mention the small number of stations compared to cars and the compressed gas distribution capacity of each province in relation to the population. This difference is so great that it has created a difference of 500% between the best and the worst province. On the demand side, we can mention the extra costs of repairing and maintaining gas-powered vehicles compared to gasoline-powered vehicles, less power, reducing trunk space, and so on.