ANKARA Aug 1 Turkey raised its natural gas
prices by nearly 20 percent on Friday in line with a new
cost-based pricing mechanism, state pipeline company Botas said,
announcing a move likely to increase already high inflation.
Analysts said the price rise was set to push up annual
consumer price inflation, which was up 10.6 percent year-on-year
in June, by 0.2-0.5 percentage points. Turkey has an official
end-year target of 4 percent, which has long been out of reach.
The gas price rise was fixed at 16.88 percent for
residential properties and 18.77 percent for industry, Botas
The cost-based pricing mechanism, introduced by the High
Planning Board from the start of July, applies to all state
energy companies and is seen as an important step before further
privatisations of power distribution and production facilities.
Before the new system was introduced, electricity prices for
industry were raised by 22 percent effective from July.
Electricity companies have not applied to set new power tariffs
Rises in energy prices generally have been a major component
in Turkey's double-digit inflation.
The central bank, which has raised interest rates this year
and said it could tighten further, has repeatedly cited energy
prices as an inflation risk.
(Reporting by Orhan Coskun, editing by Anthony Barker)