Turkey plans to purchase oil from Libya in an attempt to reduce its dependence on Iranian oil by 20 percent, a move that is expected to help the country bypass sanctions the US plans to impose on countries buying oil from Iran.
Turkish Energy and Natural Resources Minister Taner Yıldız told reporters Friday in Ankara that Turkey plans to purchase one million tons of crude oil from Libya in 2012 through the Turkish Petroleum Refineries Corporation (Tüpraş). “We believe that our decision is right for the normalization of Libya and to increase the trade volume bilaterally,” he said.
Tüpraş announced on Friday that the company has decided to reduce its purchases of crude oil from Iran by 20 percent and will make up the shortfall through “other sources.” The company did not provide further details. Turkey hopes that it can still get a waiver from sanctions which the United States plans to impose on countries buying oil from Iran despite not being named on a list of exempted nations released by Washington. Turkey is also in talks with Saudi Arabia on spot oil purchases and longer term contacts, Yıldız added. “We plan to increase the number of countries we buy oil from and the routes we use,” Yıldız said.
Turkey imports around 200,000 barrels per day of oil from Iran, representing 30 percent of its total imports and more than 7 percent of Iran’s oil exports. The United States exempted Japan and 10 EU nations from sanctions because they have significantly cut purchases of Iranian crude oil, but left Iran’s top customers, China and India, exposed to the possibility of such action. Turkey’s sole refiner, Tüpraş, a unit of Koç Holding, confirmed in a statement to the Istanbul stock exchange that it would cut its purchases of Iranian crude by 20 percent. Tüpraş is Turkey’s main oil importer, and currently buys 30 percent of its crude oil from Iran, where it has an annual purchase contract of 9 million tons. Koç Energy Group Chairman Erol Memioğlu told reporters last month that the existing Tupraş oil contract with Iran ends in August. He said that he expected more clarity on the details of the sanctions in May, before Washington’s measures on oil-related transactions take effect on June 28.
“Turkey is putting itself in a bad situation,” İstanbul Technical University Energy Institute Director Abdurrahman Satman told Today’s Zaman. He said strong economies have many options on the energy issue but Turkey is not in a situation to act in such comfort, adding that should Iran stop exports, Turkey faces a much increased energy bill. According to Satman, Turkey’s other options are Saudi Arabia, Iraq and Kazakhstan to a certain extent.
Natural gas issue
Turkey’s maneuver in oil purchase raises question marks over the country’s natural gas deal with Iran and whether or not Iran would seek revenge on Turkey because of the oil issue. According to Necdet Pamir, an energy policy expert and also a World Energy Council Turkish National Committee board member, Turkey’s policy is not “wise” and its decision to reduce purchase of oil from Iran might have an impact on natural gas and electricity as well. “Justified or not, gas from Iran can be cut in the middle of winter,” he told Today’s Zaman, adding that such an inconvenience would affect electricity use. Recalling that Turkey gets 63 percent of its oil and 75 percent of its natural gas from Iran and Russia, Pamir said Turkey’s new policy might lead to problems in the country’s energy sector.
Pamir warned that Iran might attempt to destabilize Turkey through the terrorist Kurdistan Workers’ Party (PKK), which has branches in Iran. “This is too much of a pro-American style,” he said, adding that Turkey should have considered this energy policy thoroughly as the country largely relies on Iran as a source.
Energy expert Arif Aktürk, a former official of the state-owned Turkish Pipeline Corporation (BOTAŞ), agreed with Pamir and added that Turkey cannot afford to lose Iran, Russia and Algeria, from which the country imports natural gas. He told Today’s Zaman that Turkey ties its hands by not finding an alternative source for natural gas.
According to Former BOTAŞ President Gökhan Yardım, whether or not Iran can cut Turkey’s natural gas is not in question in the presence of a binding agreement. Yardım does not believe that Turkey’ is trapped on the issue of energy. “Politics shouldn’t be involved in this,” he argued and went on to say in an interview with Today’s Zaman that liquefied natural gas (LNG) can be an alternative natural gas for Turkey. |