Benzene May Hit 45 Baht Per Liter & Diesel Could Hit 38 Baht Per Liter In The Next Few Days

[sriracha john]

BOT says oil prices obstructing economic measures

The Bank of Thailand (BoT) confirmed oil prices in the world market still fluctuated in an estimated range, adding that it would consider adjusting economic figures if the situation worsened.

BOT Governor Tarisa Watanagase revealed that the bank has earlier estimated that the country’s economic would grow by 4.8 to 6 percent, but it depends mainly on the oil situation.

She elucidated that the oil prices are currently the main factor obstructing Thailand economic expansion since the country is dependent on oil import.

- ThaiNews / 28-04-08

[Heng]

Woohoo! Less traffic on the roads.

I wish ! How many drivers do you know who complain about the price of fuel AND own a bicycle?

Every household that can afford a car has at least one bicycle, usually for short trips or for the kids.

What good is a bicycle when you have to drive about ten kilometers through the traffic, and with daily rains?

Why do you think there will be less cars on the road? People still have to go to work everyday and shops still have to buy their supplies.

Do you think 8AM traffic jams are caused by leisure drivers out to show off their hot rides? In this country people have stopped driving for pleasure long time ago.

The average salary in Bangkok is not 200B a day. That is a minimum daily wage for manual labour. And even that is enough for adriving a motorcycle.

I'm not saying it's going to be like driving around during Songkran or in the middle of the night from 11pm to 4am where yes, driving is indeed a pleasure.... but eventually there is a point where people won't be able to afford it. Just look at all the rice mills that produce the traditionally lower grade (and lower priced) of rice... business is booming. People would prefer MBK or Hongthong but when they can no longer afford it (not that those brands are hurting either by the way), they are forced to change their habits.

There will be more companies laying off workers (fewer people who need to commute) and more people will be packing themselves onto buses and klong boats. And no doubt there will be folks who will be forced to commit the ultimate Thai taboo.... yep, car pooling.

[Plus]

So you are saying there will be less traffic because many will lose their jobs. Well, to make that kind of impact, job losses should be in millions, if that happens, no one would care about the traffic.

Buses are not really an alternative. They are ok for those who rent apartments on the major roads, people in housing estates all around Bangkok will need to make several connections to get to their offices, and it can be costly. It's generally cheaper to drive than to use Skytrain/MRT, btw.

Just last month I sent my car for LPG conversion and I used all kinds of public transport as a substitute. It can be done, but it's not cheaper. And I had to move to an apartment downtown, there's no public transport in our mooban.

Imagine someone living in Romklao (you know that area very well, don't you?) commuting to the city center by bus. It would take what, 3-4 hours one way? Right now it's about 40 min from there to Prakhanong by car.

Oh, and don't forget the kids. You can' take a bus to work, but if you need to drop the kids at school on the way - just forget about it.

>>>>

After 7-9 years of skytrain there aren't that many people left who can abandon their cars.

[Heng]

So you are saying there will be less traffic because many will lose their jobs. Well, to make that kind of impact, job losses should be in millions, if that happens, no one would care about the traffic.

Buses are not really an alternative. They are ok for those who rent apartments on the major roads, people in housing estates all around Bangkok will need to make several connections to get to their offices, and it can be costly. It's generally cheaper to drive than to use Skytrain/MRT, btw.

Just last month I sent my car for LPG conversion and I used all kinds of public transport as a substitute. It can be done, but it's not cheaper. And I had to move to an apartment downtown, there's no public transport in our mooban.

Imagine someone living in Romklao (you know that area very well, don't you?) commuting to the city center by bus. It would take what, 3-4 hours one way? Right now it's about 40 min from there to Prakhanong by car.

Oh, and don't forget the kids. You can' take a bus to work, but if you need to drop the kids at school on the way - just forget about it.

>>>>

Buses are definitely cheaper and they are an alternative for people in all parts of the city. 3-4 hours is time they have... money is what they will soon have less and less of. Sending the kids to school? Not if they can barely afford the tuition. The kids will almost certainly be taking the bus... preferably the non-aircon bus for whatever it costs nowadays (5 Baht? 7 Baht? for nearly unlimited distance... compare to the operating costs of X Baht per kilometer for your own automobile).

And yes, despite all of the turmoil, there will be plenty around that will enjoy LESS traffic on the roads... even if it's just a little less.

[bdenner]

Oil price may top 45 baht/liter in next few days

Energy specialist Manoon Siriwan admits that the retail prices of benzene may top 45 baht per liter while the retail diesel price could hit 38 baht per liter in the next few days, .............................

- ThaiNews / 22-4-08

Well this thread has been running a week or so now and Diesel has not risen 1 satang up here - still 34.09

[cclub75]

Solar energy, wind energy, tide movement energy, hybrid engines......ALL developments still in their baby shoes but will grow fast.....VERY FAST and replace oil in the future.

Let's not forget that less than 60-70 years ago mankind couldn't even imagine that we could fly within 10-12 hours to the other side of the world where it took 6 months by ship before.

NEVER underestimate mankind and it's brains.

I admire your optimism LaoPao... However, you need to be realist : nuclear, wind, solar or whatever... in Thailand ?

When our Prime Minister cooks for his friend PM of Burma, when the Democrat Party is talking about "pubic hairs" and conspiracy against General Prem, when the only debate is to know how we are going to amend the Constitution or which color is better to make T-shirts for the King (the list is endless)... ?

You need to come back on earth, it means on the... thai soil.

Of course mankind will probably find a way, in the long term... but before this, thaikind if I may say is going to have serious trouble...

Edited April 30, 2008 by cclub75

[LaoPo]

Solar energy, wind energy, tide movement energy, hybrid engines......ALL developments still in their baby shoes but will grow fast.....VERY FAST and replace oil in the future.

Let's not forget that less than 60-70 years ago mankind couldn't even imagine that we could fly within 10-12 hours to the other side of the world where it took 6 months by ship before.

NEVER underestimate mankind and it's brains.

I admire your optimism LaoPao... However, you need to be realist : nuclear, wind, solar or whatever... in Thailand ?

When our Prime Minister cooks for his friend PM of Burma, when the Democrat Party is talking about "pubic hairs" and conspiracy against General Prem, when the only debate is to know how we are going to amend the Constitution or which color is better to make T-shirts for the King (the list is endless)... ?

You need to come back on earth, it means on the... thai soil.

Of course mankind will probably find a way, in the long term... but before this, thaikind if I may say is going to have serious trouble...

Thailand may be a little slower than other countries but in the end it will -have to- switch to alternative energy. There's no other option but it will take at least another few decades before oil is replaced.

LaoPo

[Plus]

Buses are definitely cheaper and they are an alternative for people in all parts of the city.

Make two air-con connections and it's at least 24 baht. With LPG I can easily drive 12km on 24baht in a two ton vehicle with 3l engine - it's comparable to ONE bus ride fair on the same route, forget connecting routes or stops at the mall on the way. Small cars like Vios/Jazz can get about the same economy on petrol if they try.

"All parts of the city" - you must be joking. Out of about 100km I drive everyday, not more than 30km are covered by bus routes - Romklao, KM8 and Sukhaphiban 1. Kaset-Navamin - no, Ekamai Ramintra - no, Rama9 past Ramkhamhaeng - no, motorway - no. And there are endless moobans along each on of these roads and in countless sois on both sides.

[jonniebkk]

Don't really know what people's beef with gas prices is...bottled water (fancy European ones at least) can run to US$ 25 per gallon; what's the cost of a gallon of Starbuck's latte...it costs B 70 for a few ounces!

The price will be what the market says it is...you can choose to buy it or not.

One good thing about high gas prices, however, is that the value of my car doubles every time I fill-up the tank

[sriracha john]

Energy Minister expects global oil prices to reach 200 US dollars

The Energy Minister, Lt. Gen. Poonpirom Liptapanlop, admits that the global oil prices may hit 200 US dollars per barrel soon.

Lt. Gen. Poonpirom says the oil price hike in the global market is caused by irregular trade activities, and the oil prices in Thailand are still fluctuating. She says her ministry has been closely monitoring the direction of energy trade. She points out that the Thai government’s alternative energy consumption promotion can help conserve energy in a sustainable manner.

The Energy Minister says she and the Deputy Prime Minister and Finance Minister, Surapong Suebwonglee, will discuss the tax incentives for importing NGV engines, as the current tax incentives will expire by the end of this year. She says further details will be reported by the Ministry of Finance.

- ThaiNews (today)

[jonniebkk]

Energy Minister expects global oil prices to reach 200 US dollars

The Energy Minister, Lt. Gen. Poonpirom Liptapanlop, admits that the global oil prices may hit 200 US dollars per barrel soon.

Anything is possible but with the end of the US Fed's interest rate cutting cycle, the $ will stabilize and the bias is for further strengthening (its already started the past couple days), it's far more likely oil prices will stabilize or fall than rise to $ 200 pbl. We have already seen the price of commodities and gold fall back (in the case of gold almost 20%) from recent highs.

There is allot of money long on commodities and short the $ that has been a major factor in the run-up of these goods. Many people have allot of paper profits now and when they start to unwind these trades, there could be a sharp fall in prices (especially oil as US demand has fallen substantially due to price increases). IMO, the base metals and ag commodities will likely stay strong as the basic growth story of the BRICs remains intact and people always have to eat. But rich Western consumers can give up driving so much.

[Heng]

Buses are definitely cheaper and they are an alternative for people in all parts of the city.

Make two air-con connections and it's at least 24 baht. With LPG I can easily drive 12km on 24baht in a two ton vehicle with 3l engine - it's comparable to ONE bus ride fair on the same route, forget connecting routes or stops at the mall on the way. Small cars like Vios/Jazz can get about the same economy on petrol if they try.

"All parts of the city" - you must be joking. Out of about 100km I drive everyday, not more than 30km are covered by bus routes - Romklao, KM8 and Sukhaphiban 1. Kaset-Navamin - no, Ekamai Ramintra - no, Rama9 past Ramkhamhaeng - no, motorway - no. And there are endless moobans along each on of these roads and in countless sois on both sides.

Air con? That's a luxury they soon won't be able to afford. As for LPG/NGV, most of these folks who will be hurting because of gasoline prices can't afford the conversion without resorting to getting it on credit.

Looks like a lot of people will be walking or finding alternative means to getting to some bus/minivan/converted truck-bus/etc. stations and stops then.

IMO traffic is already thinning out somewhat on the BKK-Chonburi motorway. I make about 3 roundtrips a week and although I often nap through most of it, when I'm awake I really think the drive is getting much nicer with few cars (true, the expansion they have done might be part of the reason as well in addition to higher fuel costs).

[PeaceBlondie]

91 benzene is at 36.24 now. Anybody care to guess if it will peak around 38?

[sriracha john]

FUEL PRICE

Oil at $200 a barrel not so unlikely, says minister

Thailand is looking fearfully at the not-so-unlikely prospect of crude oil prices hitting US$200 a barrel, which could result in motorists paying 56 baht a litre for premium petrol. Speaking at the Thailand Energy Showcase 2008 seminar, Energy Minister Poonpirom Liptapanlop said the $200 mark was possible based on statements by the president of the Organisation of Petroleum Exporting Countries (Opec), Chakib Khelil, who attributed the weak dollar to the US recession. According to Opec, every 1% drop in the dollar's value will result in the crude price rising by $4 a barrel. Poonpirom advised the industrial sector to prepare for the possibility by adopting energy saving measures and switching to renewable energy. A source at PTT Plc said premium petrol would reach 56.5 baht a litre at the pump if the crude oil price trading in New York hits $200, based on an exchange rate of 32 baht to the dollar. Diesel prices could reach 53 baht. Premium petrol currently sells for 37.09 baht and diesel 33.94 baht. The minister said proposals to cut the tax on diesel had gone nowhere as they needed approval from the Finance Ministry, because of the impact it would have on government revenue.

Continued here:

http://www.bangkokpost.net/News/01May2008_news03.php

Edited May 1, 2008 by sriracha john

[ovenman]

The minister said proposals to cut the tax on diesel had gone nowhere as they needed approval from the Finance Ministry, because of the impact it would have on government revenue.

And honestly, what would the tax cut really do if implemented? Knock the price of diesel down by a few baht at best? It certainly won't reduce the price from 33.94 baht/litre to 10 baht/litre.

[Theyreallrubbish]

The minister said proposals to cut the tax on diesel had gone nowhere as they needed approval from the Finance Ministry, because of the impact it would have on government revenue.

And honestly, what would the tax cut really do if implemented? Knock the price of diesel down by a few baht at best? It certainly won't reduce the price from 33.94 baht/litre to 10 baht/litre.

Ooh I remember the days of under 10 Baht a liter. I used to take a big V8 Landcruiser from Bangkok to Chiang Mai without even thinking about the fuel cost.

I just drove from Chiang Mai to Mae Sai and back in a rented new Toyota Yaris and it was 1500 Baht in fuel!

[Plus]

Air con? That's a luxury they soon won't be able to afford.

You are getting carried away.

Are you saying that air-con buses will be empty as well?

Whatever your predictions are, my point is that using public transport is not as cheap as people are led to believe. That is a fact, interpret it in any way you want.

[Heng]

Air con? That's a luxury they soon won't be able to afford.

You are getting carried away.

Are you saying that air-con buses will be empty as well?

Whatever your predictions are, my point is that using public transport is not as cheap as people are led to believe. That is a fact, interpret it in any way you want.

As usual it's all relative. There will be some folks who will have to abandon their pickups for the aircon bus, there will aircon bus riders will more often opt for the non-aircon bus, pushing some of those folks onto songthaews, etc. No different than some of the folks who might usually fly first class will instead opt for business, and some folks biz folks will downgrade to economy, and some of the economy people will instead stay home and log onto TV to whinge. Generally speaking of course, since each individual has their own list of priorities and budget with which to take care of those priorities.

[Heng]

91 benzene is at 36.24 now. Anybody care to guess if it will peak around 38?

Peak is a misleading term I think: suggesting an upward climb and then downhill trek on the other side.

I think we'll have a rest stop at around 49 Baht a liter. Gotta give the oilmen time to go superyacht shopping.

[sriracha john]

The minister said proposals to cut the tax on diesel had gone nowhere as they needed approval from the Finance Ministry, because of the impact it would have on government revenue.

And honestly, what would the tax cut really do if implemented? Knock the price of diesel down by a few baht at best? It certainly won't reduce the price from 33.94 baht/litre to 10 baht/litre.

Moving Thaksin's frozen assets into the seized assets category would go a long to reach that 10 baht/liter. It's mostly taxpayers' money anyway that should already be in the Treasury.

[johnwills]

Won't be long before people returning to their car/motorbike find the cap/seat lock has been forced and their fuel has been syphoned off. New crime wave for Thailand.

[mixed]

91 benzene is at 36.24 now. Anybody care to guess if it will peak around 38?

Peak is a misleading term I think.

Unless you mean Peak Oil.

[slapout]

The petro stations in Thailand raise prices quickly when oil spot market price go up. Have anyone noticed a drop in price over past 4 or 5 days as oil declined by 8.00 us a bbl? Prior to the present govt. a price increase was preceeded by a notice in newspaper by 1 day. Last price increase at pump, the paper printed the news after the fact. Another example of strategic reporting or marketing???

[sriracha john]

Patrols to stop petrol flow to Cambodia

Police stepped up border patrols to prevent petrol being smuggled into Cambodia, where prices have gone through the roof. Smugglers are using vehicles with enlarged tanks to get the fuel across the border.

Police now record tank levels in vehicles departing Thailand via Aranyaprathet in Sa Kaew and other crossings. When they return they check to see if "unusual" amounts have been consumed.

Some enlarged tanks on lorries can hold as much as 400 litres. As many as 180 to 200 trucks cross each day.

Police suspect most are smuggling petrol to a storage facility about five kilometres from the Aranyaprathet checkpoint.

- Daily XPress (today)

[Plus]

The petro stations in Thailand raise prices quickly when oil spot market price go up. Have anyone noticed a drop in price over past 4 or 5 days as oil declined by 8.00 us a bbl?

Petrol stations do not buy their gas in Dubai, they buy it from PTT, which is a private company dedicated to making money for its shareholders.

There are other, smaller suppliers, but they are not in a position to engage in price wars with PPP. They are in real danger of going bankrupt trying to keep prices at least on PTT level. Some, like Conaco, have gone down already (or rather out of the market).

>>>

In the days when oil was cheap and we paid tree times less at the pump, every company offered to clean your windows and trown away your trash and gave you a bottle of free water. After PTT privatisation they can't afford that anymore, and PTTs own stations don't bother.

>>>

SJ, if your Landrover is really that old, you can safely install the most basic LPG system for about 18k and it will cut your fuel costs at least in half.

[sriracha john]

SJ, if your Landrover is really that old, you can safely install the most basic LPG system for about 18k and it will cut your fuel costs at least in half.

I prefer to think of "Tank" as "young" and yes, he really is that young....

That's a very intriguing idea about converting to LPG... I'll investigate it on the Land Rover forums to see if others have done it and their results. I hadn't realized converting was that inexpensive so thanks for the tip.

[PeaceBlondie]

Relative to the price of crude oil and benzene/gasoline: I do not know how the oil companies price their inventories for accounting purposes (I flunked cost accounting, twice!), but I can guess how their marketing dept. decides on the price they pass on to their customers.

In times of rapidly rising costs, you use a variation of LIFO. That stands for Last In, First Out. Regardless of what it cost you for your oldest stock still in inventory, you charge what it is costing you to replace the oil you are selling today.

Of course, few wholesale buyers ever pay the spot market price. They mostly have fixed contracts. Those contracts, however, have probably followed the soaring prices of recent years. So there is probably a blended or weighted average price for new inventory, and it is nowhere near the historical lows or $30 per barrel. At least, that's the guess of this flunkee.

[LaoPo]

Relative to the price of crude oil and benzene/gasoline: I do not know how the oil companies price their inventories for accounting purposes (I flunked cost accounting, twice!), but I can guess how their marketing dept. decides on the price they pass on to their customers.

I don't know about Thailand or the US but in many EU countries the local taxmen are the ones who take most of the pie...per liter.

That doesn't mean the oil companies don't make money though.

LaoPo

[PeaceBlondie]

Relative to the price of crude oil and benzene/gasoline: I do not know how the oil companies price their inventories for accounting purposes (I flunked cost accounting, twice!), but I can guess how their marketing dept. decides on the price they pass on to their customers.

I don't know about Thailand or the US but in many EU countries the local taxmen are the ones who take most of the pie...per liter.

That doesn't mean the oil companies don't make money though.

LaoPo

Yes, indeed, the tax man gets his share, which is usually based upon the volume sold at the pump at the station, so many cents per liter or gallon. My question is about the price of oil to an oil company, for a barrel of crude that goes to the refinery. LIFO (using a weighted average of the cost of new crude, whether bought on mid-term contract or off the latest spot market) makes sense - to charge according to the cost of the latest thousand barrels that oil company paid for the crude oil.

[LaoPo]

Relative to the price of crude oil and benzene/gasoline: I do not know how the oil companies price their inventories for accounting purposes (I flunked cost accounting, twice!), but I can guess how their marketing dept. decides on the price they pass on to their customers.

I don't know about Thailand or the US but in many EU countries the local taxmen are the ones who take most of the pie...per liter.

That doesn't mean the oil companies don't make money though.

LaoPo

Yes, indeed, the tax man gets his share, which is usually based upon the volume sold at the pump at the station, so many cents per liter or gallon. My question is about the price of oil to an oil company, for a barrel of crude that goes to the refinery. LIFO (using a weighted average of the cost of new crude, whether bought on mid-term contract or off the latest spot market) makes sense - to charge according to the cost of the latest thousand barrels that oil company paid for the crude oil.

I see. (in my country tax is not based on volume, just fixed tax/liter).

Do you think that answer can be given by anyone ? I suppose it differs from country to country and company to company. Why, for heaven's sake are gasoline/gas prices in the various parts of the world so different in price...?

Is it just taxes ? Why does an American driver pay less than half for his gas than his fellow driver in the EU or elsewhere ? One would think that the EU is closer to the Middle East than the US (transport costs).

LaoPo