One person was killed in the Iranian city of Sirjan during protests that erupted after President Hassan Rohani's government imposed gasoline rationing and price hikes of at least 50 percent, Iranian ISNA news agency reported on Saturday.
"One person was killed in Sirjan but ... we are investigating whether he was killed by the security forces who were trying to bring back calm to the city," ISNA quoted local official Mohammad Mahmoudabadi as saying.
"The situation is calm in the city and everything is under control since last night."
The security source said Tehran had demanded the closure because of ongoing public protests in both Iran and Iraq. The border would remain shut until further notice but would not affect goods or trade, the security source and the diplomat said
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The Iranian government announced on Friday that the price of a liter of regular gasoline had increased to 15,000 rials (12.7 U.S. cents) from 10,000 rials and the monthly ration for each private car was set at 60 liters. Additional purchases would cost 30,000 rials per liter.
Hundreds of people protested against the price hikes in areas including the northeastern city of Mashhad, in the southeastern province of Kerman and the oil rich province of Khuzestan, Iranian media reported.