A research on the natural gas market in Turkey and the impact of oil prices on the natural gas prices

The big part of the import invoice amount in Turkey comprise of natural gas and oil. Therefore, prices of oil and natural gas have vital importance for the economy of the country. The impact of oil prices on natural gas prices is analyzed in this study. The relation between Henry Hub natural gas prices and the West Texas Intermediate (WTI) oil prices is shown and analyzed with the graphs of 1 January 2000-31 December 2014 time interval. When the entire period is evaluated one can observe that the reaction of WTI oil prices is less instantaneous than the reaction of natural gas. That situation shows that natural gas prices in USA are influenced by some political, technologic, environmental, and security issues. When equal energy base weekly average prices are investigated, the ratio of oil prices to natural gas prices reached the record level, which was 9.51, at the 13.04.2012. After the year 2009, the reason of the increase on the oil prices and the natural gas prices was not equal because of some international improvements like the market of natural gas stock and the market of liquified natural gas, production of shale gas in USA, and deregulation of the natural gas market. Furthermore, Turkey's natural gas market is examined and suggestions are made for Turkey in the light of global improvements in the present study. Within this framework, turning to short term natural gas contracts instead of long term and providing natural gas free market are the major suggestions to Turkey. Keywords: Turkey Natural Gas Market, Natural Gas Prices, Oil Prices.