'Oil plunge may be plot against Russia, Iran'

'Oil plunge may be plot against Russia, Iran'

Lower oil prices are good for Turkey, but many factors resulting from changes in countries’ strategies and policies may change the existing picture in the oil industry, Deputy Prime Minister Ali Babacan has said, adding that many theories exist about the issue.

“We can’t say a theory claiming the latest oil plunge was against Russia and Iran is completely wrong, although we have no verified proof.  Anything could be happening,” he said late Jan. 6 when he met Turkish ambassadors on the second day of their week-long annual meeting in Ankara, as reported by Doğan News Agency.

He noted we should consider many factors defining oil prices, from the supply-demand equilibrium to the potential intention of some oil producers to sell their output for lower prices so as to prevent other countries from developing alternative methods in the sector.

Lower oil prices are good for Turkey at the end, even if there is possibility that our trade with Russia may be affected negatively or fewer Russian tourists may visit Turkey, he said.

Russia is a crucial neighbor for us and we need to follow this trend carefully in the coming period, he noted.

He added that economic developments should be followed closely by Turkey, as even the slightest signs of economic recovery in Europe have a positive impact on the Turkish economy.

At a meeting of the Independent Industrialists and Businessmen’s Association (MÜSİAD) Jan. 7, Babacan said the inflation rate could decrease to 6 percent in 2015 unless there are any currency fluctuations, as reported by Reuters.

Thanks to the decreasing oil prices and the measures taken, Turkey’s current account deficit likely narrowed in 2014 more than had previously been expected in the medium-term economic program.

“We forecasted a current account gap at around 5.6 percent of the GDP for 2014. We might see a lower rate [when the figures are announced] than the projections we had set earlier, as the plunge in oil prices had not accelerated to that extent when we made the projections,” he said.