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SUNDAY, September 25, 2022
nationthailand
Govt rejects Korn’s call to rein in refineries as fuel price soars

Govt rejects Korn’s call to rein in refineries as fuel price soars

TUESDAY, June 21, 2022
188

The Commerce Ministry has rejected Kla Party leader Korn Chatikavanij's call to reduce fuel prices by capping the gross refinery margin, saying it did not have the power to do so.

Korn on June 12 urged the ministry to use its authority under the Price of Goods and Services Act to cap the refining margin, which he claimed had risen 10-fold since June 2020, adding to soaring fuel costs.

However, industry bosses on Monday dismissed Korn's claim that Thai refineries were “robbing Thai people” with their high margin of over 8 baht per litre of oil.

The margin is the difference between the cost of crude oil and the value of refined fuel.

The Petroleum Refining Industry Club said on Monday the average gross refinery margin had risen by just 0.47 baht per litre between 2018 and the first quarter of this year.

Soaring fuel prices have put the Oil Fuel Fund – which regulates pump prices via subsidies – over 96 billion baht in debt, forcing the government to lift the price cap on diesel.

Last week, the government made a special request that refineries contribute an extra 8 billion baht to the Oil Fuel Fund for three months, from July to September.

Commerce Ministry permanent secretary Bunyarit Kalayanamit explained that regulating fuel prices was the responsibility of the National Energy Policy Council (NEPC), which oversees the Oil Fuel Fund as per the National Energy Policy Council Act.

He added that oil refineries and exporters are legally obliged to contribute to the fund under the Oil fuel Fund Act.

"Currently, authority to deal with rising oil price is in line with the aforementioned acts," Bunyarit said, adding that these laws had to be respected.