Officials are set to convene this week to address the substantial loss incurred by the Oil Fuel Fund due to oil and gas subsidy programs, although the fund’s financial standing remains manageable, as per a source at the Energy Ministry.
A subcommittee responsible for overseeing the fund, chaired by permanent finance secretary Lavaron Sangsnit, is gearing up to deliberate on the fund’s future direction, according to an anonymous source.
As of Feb 9, the fund recorded a loss of 84.3 billion baht, with 37.8 billion baht being allocated to subsidize oil prices and 46.4 billion baht for subsidizing liquefied petroleum gas (LPG).
The Oil Fuel Fund Office (Offo) has been authorized to seek a loan amounting to 110 billion baht to bolster the fund. Currently, banks have approved up to 75 billion baht.
“We still have ample cash reserves within the fund to act as a safeguard against energy price fluctuations,” the source stated.
However, given the substantial portion of the fund required for price subsidy programs, officials are tasked with finding ways to better manage and support the fund.
Offo expends an average of 200 million baht each day to support price subsidy programs, with the majority of the funds, around 68-70 billion baht per day, being allocated to subsidize diesel. Gasohol, gasoline, and LPG prices also benefit from fund subsidies.
As of last Friday, authorities allocated 4.62 baht per liter to subsidize diesel prices and 5.33 baht per kilogram to subsidize LPG prices.
The decline in Platts oil reference prices in Singapore last week alleviated the financial strain on the fund, the source highlighted.
To bolster the fund, gasoline and gasohol users are required to contribute 0.16-8.88 baht per liter, while fuel oil users contribute 0.06 baht per liter.
Offo is closely monitoring the impact of geopolitical tensions in the Middle East and Eastern Europe, which could drive up global crude oil prices. Simultaneously, it is keeping a watchful eye on the Chinese economy, which is anticipated to decelerate and could consequently drive down global crude oil prices.
Based on Texas Intermediate, Brent, and Dubai reference prices, crude oil prices rose to between US$76.8-80.9 per barrel last Friday.
READ MORE STORIES: https://bangkokone.news
Check out our new luxury magazine, Thailand One: https://online.flippingbook.com/view/981190657/14-15/
