The cost of the US-Iran conflict for Turkey: Fuel price hikes, massive increases on the way

Tensions involving the US, Israel, and Iran have escalated into a global crisis following attacks on major energy facilities in Saudi Arabia and Qatar. It has been stated that this situation will have a severe impact on fuel prices in Turkey. According to industry sources, a historic price hike is expected on the night between Tuesday and Wednesday, with an increase of 5 TL 60 kuruş for diesel and 2 TL 10 kuruş for gasoline.

Following Iran's targeting of ARAMCO's Ras Tanura refinery in Saudi Arabia and the Ras Laffan facility in Qatar with kamikaze drones, global oil markets have experienced sharp volatility. The damage to these facilities, which supply approximately 10 percent of the world's oil, has rapidly pushed Brent crude prices upward, leaving fuel pumps in Turkey facing the prospect of a “historic hike.”

A HIKE OF 5 TL 60 KURUŞ FOR DIESEL AND 2 TL 10 KURUŞ FOR GASOLINE IS EXPECTED

According to information obtained by journalist Olcay Aydilek, even before the impact of the previously announced 65 kuruş hike on LPG (autogas) has been felt, much larger increases are on the way for gasoline and diesel prices.

According to information leaked from the fuel sector, due to war-related pricing in international markets, a hike of 5 TL 60 kuruş for diesel and 2 TL 10 kuruş for gasoline is projected to take effect from midnight on March 3 to March 4. Final prices will be confirmed in the morning hours after the market closes.

This increase in diesel will directly affect the transportation and logistics sectors in particular. Calculated based on current prices, the price of a liter of diesel in Ankara could reach 67 TL. Similar record levels are expected in Istanbul and Izmir.

EXPECTATION OF A CHAIN REACTION OF PRICE HIKES

Economists point out that while the Central Bank has temporarily curbed panic in exchange rates with its decisions over the weekend to tighten TL liquidity and sell forward foreign exchange, the shock in global oil prices is directly reflecting on the domestic market. It is stated that a hike of over 5.5 TL on diesel in a single instance, in particular, carries the risk of creating a chain reaction of inflationary pressure, ranging from food and transportation to other basic goods.

News Source: 12punto