Bangkok: Pipat Ratchakitprakarn, Deputy Prime Minister and Minister of Transport, confirmed that fuel prices will see an increase starting tomorrow. Diesel prices are expected to rise by a few cents, remaining under the threshold of one baht per liter. The government is working to keep the diesel price below 33 baht per liter while accelerating adjustments to the B20 fuel formula to aid the transportation and agricultural sectors in reducing costs.
According to Thai News Agency, the Oil Fund is currently experiencing a deficit of 12 billion baht. The government awaits the formation of a new administration that can authorize the Ministry of Finance to guarantee and compensate for the fund's deficit. Should this authorization face delays, a special case will be proposed to the Election Commission. Additionally, the Ministry of Foreign Affairs has successfully negotiated with Russia for the purchase of crude oil, which is expected to stabilize the fuel supply.
Pipat discussed the fuel supply situation following a meeting with relevant agencies, highlighting that the Ministry of Energy has confirmed a sufficient fuel supply, with reserves adequate for 96 days. This assurance comes amid reports of intermittent closures and shortages at gas stations, mainly due to transportation issues. Approximately 10,000 gas stations operated by major companies like Shell, PTT, and Caltex have been affected, while unbranded stations face fuel shortages. The government plans to address these issues in an upcoming Cabinet meeting.
Regarding diesel prices, Pipat noted that price increases for both gasoline and diesel are imminent, with diesel prices set to rise tomorrow, though the increase will be minimal. The price will be capped at 33 baht, with a final decision expected later today. Historical price reductions by previous administrations were also noted, but Pipat emphasized the need for gradual price increases moving forward.
Pipat also mentioned adjustments to fuel formulas, following changes to gasoline formulas like E10, E20, and E85. The B20 formula for diesel will undergo similar modifications to manage pricing structures, with discussions set to continue. The anticipated reduction in B20 pricing is estimated at 4-5 baht, though this is pending confirmation from today's meeting.
The Oil Fund's growing deficit, currently exceeding 12 billion baht, was also a topic of concern. Past deficits reached 120 billion baht, and solutions are urgently needed. The government is considering borrowing options and awaits the new government's authority to address the deficit. If the new government cannot address the issue in time, the current administration may seek special consideration from the Election Commission.
Pipat reassured that there is no impending oil shortage, with significant reserves secured through contracts outside the Gulf. The recent agreement with Russia for crude oil purchases is expected to further stabilize supply. In response to potential U.S. conditions on Russian oil imports, Pipat indicated that the Ministry of Foreign Affairs would continue negotiations, emphasizing the global crisis's impact on such conditions.