Historic hike in diesel prices imminent: Eşel Mobil system collapses

Driven by the conflict that erupted with Iran, oil prices have seen a massive increase on a global scale. This rise in oil prices has also been reflected in fuel prices in Turkey. According to information leaked from energy circles, a historic hike in diesel prices is coming starting Friday.

HIGH HIKE EXPECTED

A hike of 5.76 TL is expected for diesel, effective from midnight tonight. According to journalist Olcay Aydilek, 58 kuruş of this hike will be covered by the Special Consumption Tax (ÖTV) as required by the Eşel Mobil system. However, since the tax rate limit under the Eşel Mobil application has been reached, the hike reflected at the pump will be 5.18 TL.

EŞEL MOBİL SYSTEM COLLAPSING

The Eşel Mobil system was implemented to keep price increases under control. However, with this hike, the government has failed to prevent the price increases from being passed on to the public as claimed. CHP Deputy Chairman Deniz Yavuzyılmaz, in a statement on March 15, had predicted that the Eşel Mobil system would collapse and that consecutive hikes in diesel prices would follow. Yavuzyılmaz had pointed out that after the diesel price reached 65.89 TL, only 0.48 TL of the ÖTV remained, noting that the Eşel Mobil system would become ineffective.

NO REGULATION FROM THE GOVERNMENT

Minister of Treasury and Finance Mehmet Şimşek had stated that this system was introduced as a temporary solution and was not sustainable. While emphasizing that the price fluctuations caused by the war were short-term, Minister Şimşek stated that no new regulations would be introduced.

The most significant factor leading to the activation of Eşel Mobil was the war that began in the Gulf region following the attacks by the US and Israel on Iran. This war affected a large portion of the world's oil supply, causing the price of Brent crude to rise by more than 40 percent. This increase also affected natural gas and jet fuel prices. Initially, with the 10.5 percent hike in diesel on March 3, the price per liter had approached 70 TL.

FOREIGN EXCHANGE AND LIQUIDITY CONTROL

During this process, the Central Bank of the Republic of Turkey (TCMB) initiated forward foreign exchange sales to bring foreign currency and Turkish Lira liquidity under control. Additionally, short selling was temporarily banned through Borsa Istanbul and the Capital Markets Board (SPK). All these measures aimed to stabilize Turkey's economy in the face of the global economic crisis.

WHAT HAPPENS IF THE ÖTV REGULATION AND PRICES INCREASE?

Minister Şimşek had explained that the Eşel Mobil system, which was reactivated after 2021, required the waiver of ÖTV revenue. However, it was also clearly stated that this system could no longer be sustained. It is anticipated that any hikes made after this stage will be reflected directly in the pump price of diesel. The 5.37 TL hike to be applied to diesel on Friday will once again bring this reality to light.

News Source: 12punto