Bangkok:The Ministry of Energy is advancing with measures to tackle the oil price crisis by introducing a plan utilizing the Fuel Oil Fund, which has received Cabinet approval. This initiative aims to provide a structured framework for intervention and subsidies in the oil price market, despite the fund's current deficit of over 100 billion baht. The ministry asserts that borrowing is unnecessary for liquidity improvement and that the situation remains manageable.
According to Thai News Agency, Mr. Pongpol Yodmuangcharoen, spokesperson for the Ministry of Energy, outlined the approach to dealing with the ongoing global energy price crisis, exacerbated by conflict in the Middle East. This has led to a significant instability in energy supply and pricing, prompting a complete reassessment of national energy planning. Even if the conflict subsides, oil prices are unlikely to return to pre-war levels due to infrastructure damage and prolonged recovery times for energy sources.
The Fuel Oil Fund and the Fuel Oil Fund Office have crafted a Fuel Oil Crisis Response Plan and a Fuel Oil Fund Strategic Plan for 2026-2029, approved by the Cabinet. These plans set criteria for compensating oil and LPG prices under three scenarios: fuel prices exceeding 30 baht per liter, significant global market volatility with price changes of more than US$10 per barrel, and trends indicating domestic oil shortages due to decreased supply and imports.
Five management tools have been emphasized to proactively address the crisis:
1. Utilizing the Oil Fund mechanism, despite its current deficit exceeding 98 billion baht, with assurances of the fund's good credit and ability to repay debts.
2. Managing refining margins by redirecting excess profits from refineries to stabilize retail prices, with 28 billion baht already collected from these profits.
3. Considering a reduction in excise taxes in collaboration with the Ministry of Finance, focusing on blended biofuels like E20 and B20.
4. Securing new energy sources through exploration and drilling for natural gas in the Gulf of Thailand and the Andaman Sea to enhance self-reliance.
5. Promoting clean energy and biofuels, including the "One Million Solar Rooftops" project and supporting ethanol and biodiesel production from agricultural crops to benefit Thai farmers.
The Ministry of Energy remains committed to this strategic plan to ensure Thailand's energy stability and economic security amidst global volatility. The Oil Fund's deficit is projected to exceed 100 billion baht, with daily compensations reaching 316 million baht, yet it remains manageable without borrowing. Contingency plans are in place should borrowing become necessary.