The government will maintain the cap on diesel prices at 30 baht a litre using subsidies from the Oil Fund until the end of May when a 40-billion-baht loan supporting the subsidy scheme is expected to be depleted.
Deputy Prime Minister and Energy Minister Supattanapong Punmeechaow said on Friday the Russia-Ukraine conflict has resulted in soaring energy prices, affecting domestic retail prices of oil and liquefied natural gas (LNG).
On Wednesday, global prices of oil and LNG were the highest in 14 years at US$180 (5,990 baht) per barrel and US$84.37 per million British thermal unit (Btu) respectively, he said.
The high prices have been driven by rising demand from an economic recovery in many countries in the wake of Covid-19 as well as the onset of recent cold spells in western countries, the minister said.
Deputy Prime Minister and Energy Minister Supattanapong Punmeechaow discusses soaring energy prices at the Ministry of Energyon Friday. (Photo by Apichit Jinakul)
However, Mr Supattanapong insisted the government will continue to maintain the cap, adding that if global crude oil prices are no more than US$115 per barrel, the 40-billion-baht loan for the Oil Fund will be able to support the subsidy scheme until May.
Asked what action would be taken if the loan is finally used up, he said: “All we have to do now is to help save on energy while waiting for [additional loans].
“We have to rely on ourselves. The government will try to cap the prices within the financial limits. If everyone helps with energy saving, the cap will last long, and if prices go down, it will last even longer,” he said.
On Wednesday, the National Energy Policy Committee (NEPC) resolved to lift the borrowing limits of the Oil Fund to allow for management flexibility and approved guidelines to address surging fuel prices.
The NEPC decided to remove the borrowing limits set at 40 billion baht, said energy permanent secretary Kulit Sombatsiri.
The measure, to be submitted to the cabinet next week, would also require legal amendments, he said. Currently, the law governing the Oil Fund does not allow its management to seek loans worth more than that sum.
(Source: – Bangkok Post)