Subsidies costs for PTT : from 14 to 20 billions (and counting)

One month ago… the total cost of diesel, NGV and LPG subsidies was 14 billions THB for PTT… Now they are talking about 20 billions..  only for LPG !

PTT Plc expects to receive compensation of around 20 billion baht for some of the cost of importing liquefied petroleum gas (LPG) this year, says chief executive and president Prasert Bunsumpun.

The government had committed to seek funds to offset PTT’s losses from heavy subsidies of LPG, Mr Prasert said at a seminar held yesterday by TMB Asset Management on energy exchange-traded funds (ETFs).

The Energy Ministry continues to fix LPG prices at US$330 a tonne, against a world price of $950. The government was supposed to float the price LPG used in transport on July 1. Instead it continues to subsidise the fuel, which is being used heavily by drivers worried about high gasoline and diesel costs.

As a result, Thailand in April became an LPG importer and PTT, as the sole importer, faces higher costs.

PTT imported 20,000 tonnes of LPG in April and the figure doubled in June, reflecting soaring demand for the gas.

”The 20 billion baht in compensation we (PTT) ask for is only the loss from imported LPG, and does not include our burden from other subsidy programmes,” Mr Prasert said. (Bangkok Post)

2 Responses to “Subsidies costs for PTT : from 14 to 20 billions (and counting)”

  1. 1 fall 13 July 2008 at 5:58 am

    Oil subsidy… LPG subsidy… what’s the different?

  2. 2 ThaiCrisis 13 July 2008 at 6:59 am

    … None. In principle.

    Only some slight differences regarding :
    -the amount
    -the “target” (AKA the group to please)
    -and the “scapegoat” (who will be entitled to… pay back the “subsidy”… read the “gift”, because of course and always… a subsidy must be paid back… by someone).

    As you see, to subsidize is actually a hard word. Lot of brain juice in it.

    Many factors to… factorize. Poor politicians, their brain must be really hurting…

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Thailand Crisis

Coup, Economic slowdown, Terror In the South... The situation is worsening in Thailand. Bumpy road like often before.

But this time, it's different.

The key to understand the present turmoil is the inevitable... succession of King Bhumibol.

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