“Last year, oil prices saw levels of more than $80 per barrel. Turkey’s energy import bill increased as a result of this upward trend in the international markets, as Turkey imports90 percent of its oil demand and 99 percent of its natural gas demand,” Yunus Furuncu, energy researcher at Ankara-based Foundation for Political, Economic and Social Research (SETA), told Anadolu Agency.
Furuncu surmised the hike in oil prices is the main reason for the increase in the country’s energy import bill.
On Oct. 3, 2018, the international benchmark Brent crude hit a yearly high of $86.74 per barrel. During the period from May to December, oil prices were highly influenced by the U.S. decision to impose sanctions on Iran, along with OPEC’s move to rebalance the market and with escalating trade tensions between the U.S. and China. On Nov. 6, 2017, Brent crude’s highest rate for 2017 amounted to $64.27 per barrel
He also highlighted the importance of precipitation and weather conditions given that these help boost energy production from hydropower.
“Precipitation and weather conditions have a direct effect on Turkey’s energy import bill. When the dams are filled, Turkey takes advantage of its hydroelectric plants in order to produce electricity and reduce the usage of natural gas,” Furuncu said, adding that efforts towards greater energy efficiency would also make a significant contribution to the import bill.
Furuncu predicted that the energy import bill for next year would be around $45 billion, however, he added that this amount would be determined by developments in U.S. shale production as well as world economic growth.
He further explained that slowing of economic growth, accompanied with increased U.S. shale production causes a downward trend in prices, while on the other hand, sanctions on Iran, developments in Venezuela, production cuts by OPEC and non-OPEC members leads to an upward trend.
“So we will see some volatility in the markets in 2019. The energy prices will be responsive to these developments and these uncertainties will determine the prices. However, we do not expect Turkey’s energy import bill to be as high as those times when we paid around $60 billion. This will never happen again. We expect to something around $45 billion in 2019,” he concluded.
Turkey’s energy import bill was $60.1 billion in 2012, and gradually decreased in the following years. The bill was $55.91 billion in 2013, $54.90 billion in 2014, $37.84 billion in 2015, and $27.15 billion in 2016, according to the official data.