Oil sales in Thailand and other countries fell sharply in March and April, as economies worldwide ground to a halt under lockdown measures to curb the pandemic, an oil industry source said.
Airlines around the globe have suspended services amid the crisis, dramatically cutting the demand for jet fuel.
In Thailand, demand for aviation fuel has fallen by 90 per cent, leaving refineries unable to sell their stored product.
Diesel orders have also dropped, but demand is still there thanks to transportation needs. At the same time, petrol use in Thailand has hit new lows, after numerous businesses suspended operations because of the lockdown measures.
The source said Thai refineries needed to adapt to the situation by, for example, reducing production of jet fuel and switching to the manufacture of other kinds of oil and fuel.
Refineries around the world were gradually winding down their production capacity, in line with the falling demand, said the source, pointing to output falls of 10 to 30 per cent at Singapore, South Korea and India refineries, as well as those in Thailand.
Six refineries in Thailand have seen a total Bt10 billion wiped off the value of their oil in the first quarter of the year, the source said.
The second quarter would bring more favourable conditions as the Covid-19 crisis eased, with further improvement expected in the second half of 2020.
However, the source warned that the oil market may take time to recover as the virus crisis would linger. The pandemic would likely last to the end of 2020 or beginning of 2021, before normal life could be restored.
Published : April 22, 2020
By : THE NATION