Energy ministry proposes ways to slash fuel prices
The Energy Ministry is to propose three measures to the new Pheu Thai led-government to bring down fuel prices in a bid to reduce people’s financial burden, a source at the ministry said on Wednesday.
The first measure is to bring back the 5-baht cut on diesel excise tax, which was implemented for two consecutive years by the outgoing government and ended last month.
The measure used subsidies from the Oil Fuel Fund to hold the retail price at no more than 35 baht per litre.
However, the timeframe for implementation of this measure must be in line with the global diesel price so as not to place too big a burden on the fund, said the source.
The second measure is to reduce contributions from diesel and benzine retail prices to the Oil Fuel Fund, which will bring down the retail prices of both fuels. To make this measure possible, the government must implement an efficient financial administration to ensure that the fund can still pay debts and interest to fuel trade partners.
The last measure is to adjust the fuel structure, especially in refinery prices, which have been viewed by several parties as being too high, said the source.
The draft of the new structure is being prepared by the Energy Policy and Planning Office (EPPO), but will take some time to complete, it added.
“The first two are short-term measures that would bring the fuel prices down immediately,” the source said. “Meanwhile, the third measure will probably need more time to study, as Thai refineries are preparing for the Euro 5 standard starting next year, which will further push the production cost up.”
