Bangkok: Chaos ensued last night as news spread online that gas station prices would rise, prompting a rush of people to fill up their tanks.
According to Thai News Agency, the Energy Policy and Planning Office (EPPO) strongly supports B20 biodiesel, citing its lower price compared to B7 by 5 baht, despite the continued rise in global prices.
This morning, government-owned retailers under Section 7 have not increased fuel prices. However, last night, rumors circulated on social media that fuel prices would rise by at least 2 baht per liter, following a sharp increase of 6-8 baht per liter on March 26th. This led many to believe the rumors, resulting in a large number of people filling up their tanks before 5 AM last night.
The reason for not raising prices and people believing fake news is the ongoing war with Iran, which has caused global oil prices to rise. This situation forced the Fuel Fund to issue a new announcement effective today, involving increasing subsidies for diesel and reducing subsidies for gasohol, to maintain liquidity due to a deficit of nearly 40 billion baht in the fund. This adjustment means gasoline users will have to subsidize diesel users.
The National Fuel Fund Committee (NFF) announced adjustments to fuel contributions to the Fuel Fund for diesel fuels. Compensation for B7 has increased by 0.65 baht, from 16.02 baht to 16.67 baht. For B20, compensation has increased from 18.94 baht to 19.50 baht per liter. The compensation for E10 gasoline has been adjusted from 0.56 baht to an increased contribution of 0.43 baht. Contributions to E85 have increased from 2.99 baht per liter to 3.31 baht, and for gasoline 95, from 5.50 baht to 6.59 baht per liter.
The Fuel Fund Management Committee (FFMC) stated the decision to subsidize B20 at a high rate aligns with the government's policy to promote B20 diesel use to alleviate production costs. The retail price is set 5 baht per liter lower than B7 diesel, aiming to benefit the industrial and transportation sectors.
Major oil retailers, including PTT, Bangchak, and Shell, are accelerating production processes and preparing storage facilities to distribute B20 biodiesel to target groups within the next week. However, B100 production cannot yet be fully implemented due to a shortage of methanol, a key component in biodiesel production. Operators are working to resolve this issue and increase biodiesel production to meet industrial and transportation sector needs.
Meanwhile, international media reported that global water prices rose amid uncertainty about a ceasefire in the ongoing war with Iran. The WTI crude oil contract for May delivery rose $5.16 to close at $99.64 per barrel, while Brent crude oil futures for May delivery rose $4.56 to close at $112.57 per barrel. Brent crude oil futures have risen 53% since February 27, before the US and Israel attacked Iran, while WTI has increased 45%.
Analysts view a prolonged war, including an extended closure of the Strait of Hormuz or damage to infrastructure, as a risk premium in oil prices. The Iran-Iran war has reduced global oil supply by approximately 11 million barrels per day, with the International Energy Agency (IEA) stating that this crisis is more severe than the two oil crises of the 1970s combined.