Thai Finance Minister: Era of Low Oil Prices Over, Will Accelerate Renewable Energy Development

Thailand's Finance Minister Ekniti Nitithanprapas stated in parliament yesterday that severe damage to energy infrastructure in the Middle East means oil and natural gas supply may take 1 to 2 years to stabilize. He said: "The era of low oil prices is over, at least not for the next one to two years." The Nation reported today that Ekniti pointed out the government has assessed the economic risks brought by the Middle East war, noting that the conflict has triggered a global energy crisis, leading to drastic fluctuations in oil prices. He warned that this crisis might not end soon and could evolve into stagflation. Ekniti emphasized that the government must act early to prevent the crisis from escalating and repeating the 1997 financial crisis. However, he explicitly stated that the government will not cut fuel consumption tax due to the recent energy shock, pointing out that reducing oil prices through tax cuts would have a similar effect to using the oil fuel fund, but would further reduce government revenue needed for public services. He said Thailand must ensure necessary public spending and use the oil fuel fund as the first line of defense. In response to calls for lower oil prices, he said this move is not much different from using the oil fuel fund and would instead bring more severe consequences for national finances, noting that Thailand's long-term heavy reliance on diesel subsidies has led to a serious deficit. He added that the government plans to accelerate the promotion of solar, biofuels, and other renewable energies to alleviate the impact of rising energy costs on households and businesses. (Edited by Chen Chenggong) 1150410