Turkey’s energy watchdog puts new price cap on fuel companies

ANKARA

Turkey’s energy watchdog has announced it will put a new price ceiling on fuel companies.

“Our board has decided to put a price ceiling over fuel prices in accordance with the related articles of the Oil Markets Law, numbered 5015, as the fuel distribution companies did not act in line with the price regulations at its meeting on Feb. 19. The decision will be effective as soon as it is published in the Official Gazette. The profit margin will be limited at 34 kuruş in gasoline per liter be added over the refinery price and 37 kuruş in diesel. This will bring around a 9-10 kuruş cut per liter at the pumping price,” the Energy Market Regulation Board (EPDK) said by a written statement on Feb. 20.

After the decision was published on Feb. 20, the price cap would be effective as of Feb. 21 for the following two months, the board said.

Prices will be announced for each province on the board’s website.

The board will continue to follow the price settings in the market and has enabled the companies to set affordable refinery, distribution and dealer prices in line with the global free market conditions, it said.

Stepping up efforts to control the soaring prices in the market, the EPDK had imposed a two-month ceiling on prices between March 21 and May 21 last year.

After lifting the ceiling, the prices slightly rose due to rising crude oil prices and a weakening Turkish Lira.

Turkey is one of the countries with the highest fuel prices. Fuel companies blame high taxes for the high prices, complaining they suffer from low profitability levels.

According to January pricing report, around 2.81 liras of 4.13 liras of gasoline per liter was given as tax to the state.

However, defying the companies’ outcry, the EPDK said the high prices paid for vendor transfers damage the market, accusing the distributors of charging high transfer costs to consumers.