Rising global energy costs put pressure on BOTAS imports Turkish energy to continue raising prices as they fall sharply in the red, as producers complain that the recent rise in prices threatens their performance.The pipeline company and trading company needed 100 billion lira ($ 6.8 billion) from Treasury last year to address its shortages and losses rapidly since Russia’s attack on Ukraine increased electricity prices, officials said.
Several challenges to the authorities
That poses a number of challenges for the Turkish authorities, which import almost all of its energy needs. BOTAS has bought billions of dollars from the Central Bank to finance its purchases, eliminating already foreign bank debts, while Treasury payments to BOTAS increase the deficit. a campaign for economic growth abroad, while maintaining an escalating pressure on inflation by 60%.
Four industrialists representing some of the most demanding sectors of gas and electricity, such as steel, pottery and cement, told Reuters that rising costs would increase the prices of their goods.
BOTAS has kept gas prices below $ 830
To date BOTAS has kept its gas prices to consumers and industries far below $ 830 per thousand cubic meters it pays in April. It said its recent rise in prices on April 1 still leaves families with an active 70% support.
“BOTAS has provided significant support to housing, electronics and industrial enterprises. Compared to the European continent, before inflation, industries and power stations paid a eighth of the price and homes paid twenty percent of the price,” a government official said. .Now BOTAS is still losing a lot, but this is government policy and funding is still ongoing. “
The end of 2020 BOTAS
Since the end of 2020 BOTAS has increased the price of natural gas in the industry by 568% in terms of lira, according to Reuters figures. That shows a 49% depreciation of the Turkish lira against the dollar at that time over rising global electricity prices. “Despite the increase, BOTAS lost billions of dollars in the first quarter. ”Said another source close to the matter.
He said BOTAS ‘balance sheet problems meant that, although Treasury continued to support the estimated 14.7 billion rupees in February, it was now facing bankruptcy difficulties. Asked about the allegations, a BOTAS official referred Reuters to the Department of Energy, who did not immediately comment. prices, ”said a source.
The cost of importing power into Turkey
Turkey’s energy expenditure costs doubled in January and February compared to last year, to reach $ 16.6 billion, which helps drive Ankara’s trade losses to 135%. The Central Bank has asked for government support, including an 18% reduction in Turkish VAT, to help them cope with rising gas prices, a government official said.They also warned that further rise in electricity prices would be reflected in commodity prices, which further pushed inflation sharply and reduced Turkish business competition.
“Electricity costs are already putting a huge burden on the seller, and they have now reached a level that puts cost more than our European Union competitors,” said ErdemCenesiz, chairman of Cement, Glass, Ceramics and Soil Products Exporters. “Organization.” This view puts us at risk of losing competition against EU companies and our hard-earned export markets around the world. “
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