Potential energy crisis to be discussed at Energy Ministry meeting
Executives of the Energy Ministry will meet on Thursday to discuss measures to respond to a possible global energy crisis as a result of the ongoing conflict in the Middle East that has pushed the crude oil price in the global market up by US$ 4 a barrel this week.
Pirapan Salirathavibhaga, Deputy Prime Minister and Energy Minister, said the meeting will be led by permanent secretary Prasert Sinsukprasert. Agencies under the ministry, including the national oil and gas conglomerate PTT Plc, will present plans for their areas of responsibility to cope with rising energy prices, he added.
Prasert added that if the war between Hamas militants and Israeli soldiers, which started with a surprise attack by the former on Saturday, escalates or drags on it could severely affect global energy prices, as the Middle East region is the world’s largest energy producer and exporter.
The ministry is monitoring the situation closely despite the fact that the crude oil price is currently fluctuating in a narrow range, he said, while urging people to understand the situation and use energy economically.
Energy Policy and Planning Office (EPPO) director Wattanapong Kurowat said on Wednesday that the conflict in the Middle East could cause the market prices of oil to soar for a short period, as the latest reports signal that peace talks are underway.
He added that the price of crude oil this week has risen after several months of plummeting due to concerns about the increasing interest rates of global banks that could affect energy demand.
EPPO had previously forecast the price of Dubai crude oil in the second half of 2023 at US$87 per barrel and diesel at US$91-98 per barrel. “The war could further raise the oil prices, but PTT estimates that they will still be under US$100 by year-end,” Wattanapong said.
“What is really concerning is the currency exchange rate,” he pointed out. “If the baht strengthens by even one baht to the dollar, it could raise the retail prices of oil by 0.7 baht per litre. On the contrary, if the dollar goes up, the price of oil in Thailand would change by 0.2 baht per litre.”
The baht on Wednesday morning opened at 36.55 baht to the dollar, increasing from yesterday’s closing price of 36.77 baht, a new high this week.
In a bid to help alleviate people’s financial burden, the government has put a cap on the diesel price at 30 baht per litre and cooking gas at 423 baht per 15 kg. canister. This measure will run until the end of the year,
The Oil Fuel Fund, which subsidises the measure, is 68.32 billion baht in deficit as of October 8.
