Rising Oil Prices Affect Thai Economy

[Jai Dee]

Leading Thai investors believe that government will help nation weather oil crisis

Thai investors are certain that the Ministry of Industry and the Board of Investment (BOI) will cooperate in expanding export and investment, enabling Thailand to weather the current global oil crisis.

Mr. Wigrom Kromdij (วิกรม กรมดิษฐ์), a prominent Thai businessman, voiced his opinion that for the nation to withstand the global oil crisis, the state and operators in the energy sector should cooperate in gradually adjusting domestic oil prices to a manageable level, so that citizens can adapt their energy usage habits. Mr. Wigrom said that oil prices would continue to rise in the long-term. Other analysts agree, and expect that oil prices may soar up to $80-100 per barrel.

Mr. Wigrom added that Thailand should re-adjust its export and investment to fit the changing energy scheme, and the nation would definitely require the assistance of the ministry of industry and the Board of Investment.

Source: Thai National News Bureau Public Relations Department - 27 April 2006

[Jai Dee]

PTT will reduce diesel prices by 1 baht per liter on April 28

The PTT Company announced that it will reduce diesel prices at its stations by one baht, effective from April 28 onwards, following government consensus of reducing diesel prices by 1 baht per liter.

Mr. Prasert Boonsampan (ประเสริฐ บุญสัมพันธ), managing-director of the PTT company, revealed that PTT will make changes to the price of diesel fuel, by reducing it by 1 baht per liter, the adjustment taking effect from 5 AM of April 28 onwards. Mr. Prasert said this policy of PTT was due to the government arriving at a consensus to reduce diesel prices by one baht per liter, in order to shed some transparency on the negative values of the Thai energy market. The government believes that when PTT has reduced its oil price, other fuel stations will follow suit.

Expected price changes on April 28 are as follow, benzene 95 at 28.34 baht per liter, benzene 91 at 27.54 baht per liter, gasohol at 26.84 baht per liter, and diesel at 26.29 baht per liter.

Source: Thai National News Bureau Public Relations Department - 27 April 2006

[Jai Dee]

Shrimp Output expected to be lower this year

The President of the Thai Shrimps Association, Mr. Somsak Paneetathayasai (สมศักดิ์ ปณีตัธยาศัย), stated that the total shrimp output for this year may not be as high as anticipated due to the current oil price hike. He said many fisherpersons have refused to sail because they could not manage the rising fuel expenses.

The consumption of sea lobsters has decreased by 50 percent in comparison to last year. In addition, the quantity of giant freshwater prawns has dropped by around 30 to 40 percent this year. As a result, the shrimp export in the second trimester would decrease by 10 percent in comparison to the same period of last year.

Source: Thai National News Bureau Public Relations Department - 27 April 2006

[Jai Dee]

50% of fishing trawlers halt their operation due to expensive fuel prices

See details in this thread.

[Jai Dee]

The government insists no raise for provincial public bus fares

The government has insisted that public bus fares in other provinces outside Bangkok will not be raised.

In regard to the oil price crisis, Acting Prime Minister Chitchai Wannasathit (ชิดชัย วรรณสถิตย์) informed that the government will evaluate the oil price situation on a monthly basis. The situation will be reported to the Cabinet meeting every week.

Referring to President of the Bus Operators Association Suchinda Cherdchai’s (สุจินดา เชิดชัย) request for the government to raise fares of public buses outside the capital, Pol. Gen. Chitchai has insisted that the government will not follow this demand. However, the government has already assisted them by reducing the diesel price by 1 baht per liter.

Source: Thai National News Bureau Public Relations Department - 27 April 2006

[Jai Dee]

Mr. Phichet affirmed that public bus operators will continue providing services to the public

The President of Thai Bus Business Association, Mr. Phichet Jiemburaset (พิเชษฐ์ เจียมบุรเศรษฐ์) affirmed that the bus operators will not halt it services as claimed by President of the Bus Operators Association Suchinda Cherdchai’s (สุจินดา เชิดชัย). Mr. Suchinda earlier requested the government to raise the fares of public buses to nine satang per one kilometer. Mr. Phichet also insisted that bus operators will continue to fix the fares.

Mr. Phichet has informed the current bus fares rate to Deputy Minister of Transport Chainant Charoensiri (ชัยนันท์ เจริญศิริ) following the announcement of Mrs. Suchinda to stop running the buses of the Transport Company Limited as a mean to pressurize the Transport Ministry to approve the increase of bus fares.

He indicated that the oil prices have not yet risen to three baht, and thus, it is not necessary to adjust the bus fares yet. He added that 600 bus operators will peg the fares of all bus services until the oil prices increase to 27.16 baht per liter.

As for the policy of reducing the fuel prices for the bus operators at 1 baht per liter, Mr. Phichet said such policy is difficult to implement since the bus operators have their regular gas stations. He has urged the government to find proper solutions as to assist the bus operators.

Source: Thai National News Bureau Public Relations Department - 27 April 2006

[Jai Dee]

Government denies request to increase bus fare

The government affirms that it will not increase the fare of bus routes to the outer provinces, due to the recent decrease in diesel fuel prices.

Police General Chitchai Wanasatit (ชิดชัย วรรณสถิตย์), the interim prime minister, stated that after evaluation of the current oil crisis on a monthly scale, the cabinet has arrived at a consensus to keep bus fare of bus routes to the outer provinces stable. Police General Chitchai added that the request of Mrs. Suchingda Chertchai (สุจินดา เชิดชัย), a bus company operator in the outer provinces, to increase bus fare has been denied.

Police General Chitchai added that the government will not take into consideration any other requests to increase bus fare at the present time.

Source: Thai National News Bureau Public Relations Department - 28 April 2006

[Jai Dee]

Mr. Thanong: Unrest situation in Iran might cause speculation on fuel prices

Finance Minister Thanong Bidaya (ทนง พิทยะ) is concerned over the situation in Iran as it might cause the oil price speculations. However, he said the government has prepared the measures to deal with the gradually rising oil price situation.

He said the government is working on the short-term measures only. He indicated that many sides are still worried about the unrest situation in Iran, as it could result in the retardation of oil production. He insisted that the government will do its best to deal with the situation.

Mr. Thanong has urged people to be patient with the fuel prices after they have affected the prices of consumer goods and transportation fares.

Source: Thai National News Bureau Public Relations Department - 28 April 2006

[Jai Dee]

Commerce Ministry is finding solutions for agricultural products during the oil price crisis

The Commerce Ministry is planning to hold a meeting to seek ways to support agricultural products that are affected by the strengthening of Thai baht currency and the high prices of fuel.

The Commerce Minister, Mr. Thanong Bidaya (ทนง พิทยะ), said that economy-related officials will hold a meeting to seek solutions for various agricultural products, especially rice. Many measures have been issued to assist farmers' financial burdens, and the government has allocated a budget to aid those farmers. The government is also trying to raise the prices of rice products.

However, he said that some agricultural products such as sugar and Para rubber have received a positive result from the strengthening of Thai baht and the oil price crisis.

Source: Thai National News Bureau Public Relations Department - 28 April 2006

[xbusman]

Commerce Ministry is finding solutions for agricultural products during the oil price crisis

However, he said that some agricultural products such as sugar and Para rubber have received a positive result from the strengthening of Thai baht and the oil price crisis.

Source: Thai National News Bureau Public Relations Department - 28 April 2006

I dont know a lot about the rubber and sugar markets but I am pretty sure they are sold on world commodity markets at hard currency pricing (dollars or euros) so can anyone tell me how soaring costs (oil price increases) or reduced baht income (stronger baht) can create a positive result in agricultural exports?

[cclub75]

I dont know a lot about the rubber and sugar markets but I am pretty sure they are sold on world commodity markets at hard currency pricing (dollars or euros) so can anyone tell me how soaring costs (oil price increases) or reduced baht income (stronger baht) can create a positive result in agricultural exports?

It's just plain and amazing stupidity, a commodity that have a great supply (and demand) those days...

Or, some errors in translation (it happens).

They will continue to speak sxxx, again and again, until the liter will be quoted 60 THB, and then they will say "sorry it's not our fault, we tried very hard to help people".

So they will make a lot of meetings (for transporters, public and private, for farmers, for fishers, for exporters, for importers, for gold traders, for mama soup sellers, for hookers, for ... every one) to try to find "solutions" and to assess that "everything is fine sabai".

They will say "hum... yes I see". And voila.

The bottom line is : there is no solution.

[Jai Dee]

Minister of commerce concerned over Iran oil production

The Minister of Commerce is concerned over the Iran conflict and its potential effects on global oil prices.

Mr. Thanong Pittaya (ทนง พิทยะ), the minister of commerce, stated that the government has prepared measures to handle rising oil prices, citing government assistance in terms of price intervention as only a short term solution. The minister is especially concerned over the conflict brewing in Iran, and stated that if violence ensues, then global oil prices will definitely be affected. Mr. Thanong added that the effectiveness of government policy cannot be gauged at this time, but the state will put in its full effort to handle the matter.

The minister of commerce added to citizens to be tolerant of rising oil prices and transportation costs.

Source: Thai National News Bureau Public Relations Department - 29 April 2006

[Jai Dee]

Gas stations in Trat running low on diesel fuel

Trat province, which has seen exceptionally high usage of energy, reports that many fuel stations in the province are short of diesel fuel.

Ms. Saiysunee Jaitheang (สายสุนีย์ ใจเที่ยง), a fuel station proprietor in Trat province, stated that the global oil crisis has caused many fuel stations in the province to use cash to procure reserve fuel from supply stocks to meet the demands of customers. Ms. Saiysunee added that this has caused many fuel stations to lose their financial flexibility, and government price control is therefore necessary.

Ms. Saiysunee added that fuel station operators are now forced to cancel their letter of credits to government vehicles, in order to have tender cash on hand to procure more fuel to meet consumer demands. She stated that from the crisis, many fuel stations are now running low on diesel fuel.

Source: Thai National News Bureau Public Relations Department - 29 April 2006