Turkey launched the Natural Gas Futures Market (NFM) under the country's energy exchange, EXIST, on Friday.
Turkey's Energy and Natural Resources Minister, Fatih Donmez said that the gas futures market will bring Turkey a step closer to its aim of becoming a regional hub, via a video message at the opening ceremony.
He noted that participants will be able to transact in the market through monthly, quarterly and yearly contracts and minimize their risks.
'Futures markets provide an advantage to natural gas producers and consumers to fix their costs and protect them from risks that could stem from volatile prices,' Donmez said.
Turkey's Deputy Energy and Natural Resources Minister and Chairman of EXIST Abdullah Tancan, announced that first transactions in the natural gas futures market with two monthly contracts for November and a monthly contract for January 2022 hit 300,000 Turkish lira.
US$1 equals 8.84 Turkish liras at 1345 GMT on Friday.
Turkey's power futures market was also launched on June, 1 to provide participants with market stability and transparency. Turkey, as a highly import-dependent natural gas consumer, consumed 47.7 billion cubic meters of natural gas in 2020.
However, consumption this year is expected to increase significantly because of further use of natural gas for electricity generation due to lower output from hydropower plants as a result of drought.
Overall natural gas consumption is estimated to reach 60 billion cubic meters throughout this year.
By Firdevs Yuksel and Nuran Erkul Kaya