Renewed 100 Lira Alarm on Diesel Prices and Global Supply Shortages
As increases in global oil prices and the re-implementation of the SCT push the liter price of diesel close to the 100 TL threshold, the new wave of fuel price hikes threatens the transportation and agricultural sectors.
With the upcoming hike in the liter price of diesel, fuel prices are once again approaching the 100 TL threshold. Following the temporary tax intervention in August, the restart of the SCT in September, the rise in global oil prices, and supply bottlenecks in the diesel market played a decisive role in the price hike decision.
Expected Increase in Diesel Prices
A price hike of 6 Turkish liras and 62 kuruş is expected on the liter price of diesel starting Tuesday, September 15. With this increase, diesel will rise to approximately 95.63 TL in Istanbul, 96.78 TL in Ankara, and 97.05 TL in Izmir.
SCT Was Zeroed in August
To limit the reflection of rising global diesel prices onto the pump, the government had zeroed the SCT applied to diesel on August 13 until the end of the month. Following this decision, a gradual tax schedule was determined, and an SCT of 3 TL per liter began to be collected as of September.
Global Oil Prices on the Rise
Brent crude, which fell below $88 in August, approached $110 under the influence of the war in the Middle East. The attack on the pipeline in Saudi Arabia and shipment problems in the Strait of Hormuz negatively affected global supply.
Severe Bottlenecks on the Refinery Side
The main problem in the global market is on the refinery side, where crude oil is converted into diesel. Refinery losses and export restrictions in the Middle East and Russia have caused diesel prices to rise much more sharply than crude oil.
Diesel Refining Margins Hit Record High
While refinery problems in Russia and the Middle East created a severe diesel shortage in the global market, the diesel refining margin reached a record level of $108.02 per barrel during the day. Industry representatives state that this tightness could last throughout the winter.
Global Inventories Decreasing Rapidly
According to International Energy Agency data, observable global oil inventories decreased by 95 million barrels in August alone. Since the war began in February, the total drop has reached 507 million barrels.
Impact on Production and Distribution Chain
Diesel is widely used not only in passenger cars but also in freight transport, agriculture, and industry. Price increases directly affect the entire production and distribution chain, from transportation to food.
New Tax Increase Expected in October
If the current regulation does not change, the 3 TL per liter SCT collected from diesel will rise to 6 TL on October 1. With new increases to be made in November and December, the tax burden will continue to increase gradually.