BANGKOK, 6 May 2011 – The Energy Policy Administration Committee (EPAC) has cancelled the diesel subsidy and will instead collect 33.55 satang per liter towards the State Oil Fund after the global oil price decreased.
Following a meeting of the EPAC, Energy Minister MD Wannarat Channukul disclosed that a decision had been made to terminate the current subsidization of diesel price at the rate of 16 satang per liter due to a continual decline in fuel price in the global market. At the same time, the collection of 33.55 satang will be imposed on each liter of diesel sold and will go to the Oil Fund, which has been greatly depleted.
The measure will help reduce the burden on the Oil Fund from 56 million THB per month to 27.8 million THB while also allowing the Government to continue its policy to retain the domestic diesel price at less than 30 THB per liter.
At present, the Oil Fund’s cash reserve stands at merely 971 million THB, as opposed to 35 billion THB at the beginning of the diesel subsidization policy. MD Wannarat said if there were any more decreases in the global oil price, the collection towards the fund could be raised further in a bid to stock up for future emergencies.
