UAE/TURKISH BUSINESS RELATIONS
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Dr. Nilgün Birgören Premium Member Group moderatorThe company name is only visible to registered members.Price hike in oil to affect inflation rate
Every $10 price hike in one barrel of oil will have a half-point impact on Turkey’s inflation and nearly $4 billion impact on Turkey’s current account deficit, according to a Turkish state minister.
Speaking at a program on state-run broadcasting Turkish Radio and Television, or TRT, on Thursday, State Minister and Deputy Prime Minister Ali Babacan said the general trend of oil prices would be dependent on political developments.
Predicting oil prices this year is extremely hard, however, Babacan said.
“Oil price hike will affect us especially in current account deficit and inflation rates. It is seen that every $10 markup per one barrel of oil will have a half-point impact on our inflation rate. This same price hike also seems to have nearly $4 billion impact on our current account deficit.”
Noting that pump price of oil is determined according to the price of one barrel of oil, the exchange rate of dollar, profit margin and tax rates, Babacan said: “In the last one year, all of the figures increased except tax rates. There is no change in taxes.”
Oil prices dropped to $40 during the economic crisis period and today is at the $115-to-$119 level.
The situation is being closely followed by the Turkish Energy Ministry and the Energy Market Regulatory Authority ( EMRA).
“We think things should be balanced in the market equilibrium. We do not have a competition understanding in which the government is totally excluded,” he said.
“As the Turkish government, we have been planning the year 2011 since last October,” Babacan said, adding that they attached priority to stability instead of growth. “Rise and falls cause great destruction in the economy. The important thing is to maintain stability and the security of the Turkish economy.”
Source: AA
- 10 Mar 2011, 7:38 pm
