Eccolo:
If there’s one chart aside from the lemming-like lira that illustrates the economic crunch facing Turkey, it’s the horror show you get when you convert the price of Brent crude into the Turkish currency. While Brent’s spike to its record near $150 a barrel in 2008 provoked screams in western capitals, Turkey is now facing an equivalent price almost three times that level due to the plunge in its currency — despite Brent crude currently trading closer to $70 a barrel. This matters because Turkey is almost wholly reliant on crude oil imports, being one of a handful of Middle Eastern countries not to sit on massive reserves of the black stuff. According to the US Energy Information Administration, Turkey imported more than 90 per cent of the roughly 860,000 barrels a day of fuel it consumed in 2015. The vast majority of oil trades internationally are settled in US dollars, so suffice to say this will be hurting. Turkey already moved once in May to reduce petrol and diesel taxes to give motorists a reprieve from the impact the plunging lira was having on oil costs and to try and tame inflation. Turkish president Recep Tayyip Erdogan has remained defiant in the face of the lira’s slide. He said on Friday he would prevail in economic warfare and called on his people to convert their dollars and gold to lira, in response to the shock that has sent his country’s currency spiralling to record lows.