Fuel Prices Jump 22% in Thailand After Subsidies Slashed

r2fow)jw0[wxf7w[ppbv0bgr_media_dl_1.png Oil Fuel Fund Office, compiled bArticle content(Bloomberg) — Millions of motorists across Thailand woke up Thursday to the steepest fuel-price increases in decades after the government moved to rein in subsidies strained by surging global oil costs.Sign In or Create an AccountEmail AddressContinueor View more offersArticle contentA routine late-night price announcement on Wednesday revealed a sharper-than-expected 6-baht-per-liter (18 cents) increase effective Thursday, sending gasoline prices up 14% to 22% by morning. Diesel — the backbone of Thailand’s transport, agriculture and industrial sectors — rose 18%, amplifying the shock for households and businesses already facing rising costs.Article contentWe apologize, but this video has failed to load.Try refreshing your browser, ortap here to see other videos from our team.Article contentArticle contentThe impact was immediate, with long lines forming at gas stations overnight as drivers rushed to fill up before the price hike took effect. Concerns over shortages and rising costs had been building for weeks.Article contentTop StoriesGet the latest headlines, breaking news and columns.There was an error, please provide a valid email address.Sign UpBy signing up you consent to receive the above newsletter from Postmedia Network Inc.Thanks for signing up!A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againInterested in more newsletters? Browse here.Article contentThe increase marks a turning point for Thailand’s long-standing fuel-subsidy regime, introduced in the wake of the 1970s oil shocks.

The Oil Fuel Fund, designed to stabilize and subsidize domestic prices, has seen its deficit widen as global crude costs climbed following the war in Iran, forcing the government to scale back support.Article contentPrime Minister Anutin Charnvirakul’s government had already been forced to lift diesel price cap this week to contain mounting fiscal pressure, underscoring the limits of state intervention as global energy markets tighten.Article contentHigher fuel prices are expected to ripple through the economy, pushing up transport and production costs and adding to inflationary pressure on food and other essentials.Article contentEmergency MeetingArticle contentThe prime minister convened an emergency cabinet meeting Thursday to tackle the price surge and instructed ministries to propose measures to ease energy and living costs.Article contentArticle contentThe cabinet approved plans to cut fuel excise tax to help bring down retail prices. The government will also increase stipends for welfare card holders, subsidize fertilizer for farmers and fuel for fisheries, as well as price controls on essential goods.Article contentSeparately, the Bank of Thailand released an open letter from Governor Vitai Ratanakorn to Finance Minister Ekniti Nitithanprapas, saying that higher oil prices could bring inflation back into the central bank’s target range sooner than expected.Article contentHeadline inflation, which has remained in negative territory for nearly a year, could return to the 1%-3% target range earlier than anticipated, driven by rising energy costs and potential disruptions to global production, transportation and supply chains linked to the Middle East conflict, Vitai wrote.Article content(Updates with details from government briefing and central bank statement.)Article contentTrending Meet the Canadian e-bike maker who is redefining the factory floor Electric Vehicles LNG Canada signs key pipeline agreement required for phase two expansion Energy Canada’s economic performance has been lagging the U.S. for years, and Statistics Canada delves into why Economy Why market bets for interest rate hikes in Canada are so high Economy Wealthsimple receives regulatory approval to offer prediction markets to investors Fintech Share this article in your social networkCommentsYou must be logged in to join the discussion or read more comments.Create an AccountSign in Join the Conversation Postmedia is committed to maintaining a lively but civil forum for discussion. Please keep comments relevant and respectful. Comments may take up to an hour to appear on the site. You will receive an email if there is a reply to your comment, an update to a thread you follow or if a user you follow comments. Visit our Community Guidelines for more information. Meet the Canadian e-bike maker who is redefining the factory floor Electric Vehicles LNG Canada signs key pipeline agreement required for phase two expansion Energy Canada’s economic performance has been lagging the U.S. for years, and Statistics Canada delves into why Economy Why market bets for interest rate hikes in Canada are so high Economy Wealthsimple receives regulatory approval to offer prediction markets to investors Fintech