Turkey Raises Gas, Electricity Prices Amid Stark Inflation

By Staff, Agencies

The Turkish authorities raised electricity and natural gas prices for households by around 20 percent and by 50 percent for industries on Thursday, putting further upward pressure on inflation.

The utility price hikes are expected to push inflation – which was running at nearly 80 percent in July – up by 0.8 percentage points, according to a Reuters calculation. Higher industrial prices also lead to an indirect increase in inflation as producers reflect the cost on consumers.

Turkey’s EPDK energy regulator said it raised household electricity prices by 20 percent, those used by public and service sectors by 30 percent, and those used in industry by 50 percent.

State energy importer BOTAS also hiked natural gas prices for domestic use by 20.4 percent, by 47.6 percent for small- to medium-scale industrial customers, and by 50.8 percent for large industrial users.

Both bodies cited the conflict in Ukraine and global developments, including the Covid pandemic, as reasons for the hikes.

Turkey is almost entirely reliant on imports to meet its natural gas and oil needs and domestic demand has risen since Covid.

The rise in global energy prices this year, as well as the Turkish lira’s sharp decline – 44 percent in 2021 and more than 27 percent this year – also stoked prices domestically.

Household natural gas prices hiked 174 percent this year, small- to medium-scale industrial gas prices were raised 277 percent, and large industrial prices by 379 percent.