Oil prices could dip below $70 per barrel this week, thanks to the latest trade war drama sparked by US President Donald Trump. Thai Oil Plc, Thailand’s biggest oil refinery, says the new tariff policies could shake up the global economy and bring crude prices down.
For Thailand, this might actually be good news. Since natural gas prices are linked to oil, a drop in crude could mean cheaper liquefied natural gas (LNG), which plays a big role in the country’s electricity costs. Right now, about 60% of Thailand’s power comes from gas, so lower LNG prices could mean lower electricity bills.
The trade war is heating up after Washington slapped an extra 10% tariff on Chinese goods on Feb 4. In response, Beijing hit back with a 15% tariff on US coal and LNG imports. Oil experts believe that if this back-and-forth continues, global fuel demand could shrink, pushing prices down even further.
Meanwhile, Trump has been flip-flopping on his tariff plans. He recently held off on a 25% import levy on Canada and Mexico after they agreed to step up efforts against drug trafficking and illegal immigration. But reports suggest he might change his mind again if he thinks they’re not doing enough.
If oil prices keep falling, Thailand could end up paying less for LNG, possibly below $14 per million British thermal units. That would be a relief for households, as energy officials are already working on plans to lower the power tariff, currently set at 4.11 baht per kilowatt-hour from January to April.
In short: The trade war could shake up the economy, but for Thailand, at least, it might bring down energy costs. Stay tuned.
