Thailand PM apologises for fuel issues, lifts price caps
Thailand’s prime minister has apologised for the country’s fuel management issues, blaming prolonged disruptions on the ongoing conflict in the Middle East. Anutin Charnvirakul said the decision to end fuel price caps was taken to curb oil smuggling and ease shortages.
Speaking at a press conference at Government House in Bangkok on Saturday, Anutin addressed the situation following a month of conflict in the Middle East. He explained that the government ceased its costly price-capping efforts, resulting in a six-baht per litre price surge announced by the state Oil Fuel Fund.
The announcement triggered a nationwide rush at petrol stations as drivers sought to fill up before the new prices took effect at 5am on Thursday. The sudden hike drew widespread criticism, with the Oil Fuel Fund Office later defending the increase as driven by multiple factors.
Anutin had remained silent on the decision until Saturday’s press conference, where he expressed regret for the disruption caused by the fuel management situation.
Why the cap was lifted
Initially, the government attempted to cap fuel prices in response to the US-Israel conflict with Iran, which began on February 28, believing the situation would be short-lived. However, the oil fund’s expenditure reached 20 billion baht in the first three weeks, and daily subsidies soon became unsustainable at two billion baht.
Anutin clarified that ending the price cap does not mean a fully floating price system. Instead, the subsidy rate has been reduced from 24 baht per litre to 16 baht, aligning more closely with global market conditions and neighbouring countries.
The adjustment aims to prevent subsidised Thai fuel from being smuggled for profit and to discourage hoarding for resale to industries.
Measures to address shortages
Anutin noted that increasing delivery rounds, injecting reserves, and enforcing anti-hoarding laws have helped ease fuel shortages nationwide.
The government has also shifted focus towards supporting vulnerable groups, including low-income workers, farmers, and transport operators. An agreement with Iran to ensure safe passage for Thai oil vessels through the Strait of Hormuz is also expected to address fuel import concerns.
Finance Minister Ekniti Nitithanprapas, Foreign Affairs Minister Sihasak Phuangketkeow, Energy Minister Auttapol Rerkpiboon, Commerce Minister Suphajee Suthumpun, and Danucha Pichayanan, secretary-general of the National Economic and Social Development Council, attended the briefing.
Public cooperation urged
Despite Thailand’s refining capacity of 77 million litres per day, recent panic buying has pushed demand up to 82 million litres daily, exceeding the average by 22%. Anutin called for public cooperation to reduce excess consumption of around 15 million litres per day.
He pointed out that Thai fuel prices remain lower than those in Malaysia, Vietnam, and Laos. He also proposed that if each of the country’s 10 million households reduces consumption by one litre per day, it could significantly cut national usage and reduce imports.
Such savings would ease the government’s subsidy burden, potentially reducing oil fund compensation by 200 million baht daily. With an average fuel price of 40 baht per litre, households could collectively save around 400 million baht each day.
These savings are intended to be redirected into the Khon La Khrueng Plus co-payment scheme to help lower living costs and stimulate the economy.
Provincial governors have been tasked with managing supplies, particularly along major routes during the upcoming Songkran holiday in April. Anutin reassured the public that there would be adequate fuel for travel.
Anutin also confirmed that the list of Cabinet ministers is set for royal endorsement on Monday, with all qualification issues resolved. The new government is expected to take office next week and will coordinate with the Speaker of Parliament to present its policy statement promptly, reported Bangkok Post.
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