Iranian authorities have allocated a limit of 60 liters per month for every private vehicle at about 13 cents per liter, and beyond that quota, the price jumps to 26 cents per liter, according to Iranian state media.
"Unfortunately someone was killed", Sirjan's Acting Governor Mohammad Mahmoudabadi said, adding the cause of the death and whether "the individual was shot or not" was still unclear.
"Security forces did not have permission to shoot and were only allowed to fire warning shots. which they did", ISNA quoted him as saying.
Protests in Mashhad, Iran's second-largest city and the home of a famous Shiite shrine, saw dozens of demonstrators abandon their cars in traffic Friday night, according to IRNA.
In other cities, protests were mostly limited to blocking traffic and were over by midnight, it added.
In several cities, dozens of angry motorists blocked roads by turning off auto engines or abandoning vehicles in traffic.
State news agency Irna said there were clashes with police when protesters attacked a fuel storage warehouse and tried to set fire to it. Based on reports by citizen journalists and social media, there have been protests in at least 37 cities across Iran.
Prosecutor-General Mohammad Jafar Montazeri said the people would part ways with "the few disruptors" whose actions showed they were against the system. Iranian internet access meanwhile saw disruptions and outages Friday night into Saturday morning, suggesting "a response to limit attendance and media coverage of the protests", according to the group NetBlocks, which monitors worldwide internet access.
But fresh demonstrations were held Saturday in the cities of Doroud, Garmsar, Gorgan, Ilam, Karaj, Khoramabad, Mehdishahr, Qazvin, Qom, Sanandaj, Shahroud and Shiraz, IRNA said.
"People are very angry here in Shiraz (city)".
About 60 million Iranians would receive payments ranging from 550,000 rials ($4.68) for couples to slightly more than two million rials ($17.46) for families of five or more.
The price for a litre of gasoline within the quota doubled to 15,000 Iranian rials per litre (about $0.36).
Fuel rationing introduced in 2007 under former President Mahmud Ahmadinejad to curb consumption led to anger and violence, including the torching of several gas stations.
Such protests require prior approval from Iran's Interior Ministry, though authorities routinely allow small-scale demonstrations over economic issues, especially as the country has struggled with currency devaluation.
US President Donald Trump reinstated the sanctions against Iran past year after abandoning the landmark 2015 nuclear deal between Iran and six world powers.
The trial has plummeted, inflation is running at more than 40 per cent and the International Monetary Fund expects Iran's economy to contract by 9 per cent this year and stagnate in 2020.
The demonstrations, while not as widespread as the financial protests that roiled the country nearly two several years back, place new tension on the governing administration of Iran's reasonably moderate President Hassan Rouhani.
The measure to raise gasoline prices as Iran's economy worsens under USA sanctions and domestic corruption has angered many Iranians, prompting protests in at least five cities.
The rationing and price hike come at a sensitive time as Iran prepares for a parliamentary election in February.
Iranian state TV quoted Vice President Mohammad Bagher Nobakht as saying the higher gas price and new quota system were meant to raise funds for the government to provide cash handouts to about 60 million underprivileged people accounting for around three-quarters of the population.