Government Confirms ‘Eşel Mobil’ System Will Remain in Force

Economic management has dismissed rumors regarding the potential cancellation of the “Eşel Mobil” (Sliding Scale) system, which was reinstated in early March 2026 to buffer citizens against global oil price shocks. Despite speculations that the system might be scrapped to boost tax revenues, high-level officials confirmed that the mechanism remains the primary “shield” against energy-driven inflation.

“No Changes Planned” for the Subsidy Model

The clarification follows recent concerns that rising geopolitical tensions in the Middle East—and the subsequent spike in Brent crude prices—would lead to massive hikes at the pump. Energy journalist Olcay Aydilek reported that top economic and energy officials have explicitly stated, “There is no change in Eşel Mobil. No changes are planned at this stage,” ensuring the system will continue to function without interruption.

How the Eşel Mobil System Works

The Eşel Mobil system acts as a mechanical shock absorber for fuel prices. When international oil prices or foreign exchange rates rise:

• Instead of reflecting the increase in the pump price, the government reduces the Special Consumption Tax (ÖTV) share on fuel.

• This ensures that end users (drivers and transport companies) continue to pay a stable price, while the state absorbs the cost by sacrificing tax revenue.

A Strategic Tool for Disinflation

The decision to maintain the system aligns with the Central Bank of the Republic of Turkey’s (TCMB) current strategy. Governor Fatih Karahan previously noted that energy price volatility is a major driver of transportation costs, which in turn spikes food and consumer goods prices.

By keeping the Eşel Mobil system active:

• Cost-Push Inflation: The government effectively caps the “domino effect” that fuel hikes have on logistics and production costs.

• Purchasing Power: Household budgets are protected from sudden, high-magnitude swings in daily expenses.

• Market Stability: The transport and logistics sectors can maintain more predictable pricing models, aiding the broader disinflation effort.

While the system results in a temporary loss of tax income for the Treasury, the economic management team views this as a necessary trade-off to prevent a “permanent deterioration” in inflation expectations—a risk Governor Karahan recently highlighted as a trigger for further monetary tightening.

Source: karar