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Turkey's Imports from Iran Drop due to COVID-19

Turkey's Imports from Iran Drop due to COVID-19

Tuesday, 4 August, 2020 - 07:30
A general view of an oil refinery near Istanbul, Turkey. (Reuters)

Turkish imports from Iran fell sharply during the first half of this year affected by the coronavirus pandemic, consequently shifting the trade balance in favor of Ankara for the first time, according to a recent report by the Turkish Statistics Authority.

The report showed that non-oil imports from Iran reached $468 million during H1 of 2020 compared to about $3.7 billion in the same period last year.

During the second half of 2019, Ankara stopped purchasing crude oil from Iran after the implementation of US sanctions, but statistics indicated that Turkish non-oil imports also dropped sharply.

In March 2020, the gas pipeline running from Iran to Turkish territory was targeted in an armed attack and the damages were not repaired for three months.

Tehran recently announced it had resumed gas exports to Turkey, amid severe economic crises in the country due to the local recession and the various sanctions that the US re-imposed.

Turkish exports to Iran exceeded $843 million in H1 of 2020, registering a decrease of 40 percent compared to the same period of 2019, due to the outbreak of the coronavirus and the closure of the border between the two countries.

According to official statistics, Iranian exports to China, India, Japan, Russia and South Korea also declined in the first half of the year.

Non-oil exports from Iran saw a 35 percent decrease in the beginning of 2020, compared to the same period last year, reaching $8 billion, and non-oil exports decreased during April and May, down to $4.3 billion.

According to the International Monetary Fund (IMF), Iran's total exports are expected to reach $46 billion this year, while the country needs more than $ 64.6 billion for importing essential goods.

The IMF says Iran's significant foreign trade deficit will cause the government's foreign exchange reserves to fall to $85 billion this year.

Meanwhile, official Turkish data showed that gas supplies from Russia declined in May, coinciding with an increase in liquefied natural gas (LNG) supplies from Qatar to Turkey.

Turkey's imports of gas decreased slightly last May by 0.51 percent year on year, reaching 2.667 billion cubic meters (bcm), of which 1.221 bcm were imported through gas pipelines, and 1.445 bcm in the form of LNG.

Supplies through gas pipelines decreased 45 percent in May, compared to a threefold increase in the supply of LNG by tankers in May 2019.

The data showed that Russia's supply of natural gas to Turkey declined 62 percent in May year on year, amounting to 340 million cubic meters, while Qatar’s supply of liquefied gas to Turkey increased four times in the same month reaching 520 million cubic meters.

Azerbaijan ranked first among gas suppliers to Turkey, with a 33 percent share of total gas imports in May, while Russia's share declined to 12.74 percent, and Qatar's exports of liquefied gas increased 19.5 percent.

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