Diesel price pinned only in short-term

BANGKOK, 14 February 2011 (NNT) – Bank of Thailand (BoT) Governor Dr Prasarn Trairatvorakul has voiced his belief that the government’s measure to pin diesel price at 30 THB per liter will be just temporary.

Dr Prasarn stated that the measure is to help relieve consumers from high cost of living, preventing product prices from increasing after diesel price hikes. He however believed that the price intervention would be implemented only on a short-term basis.

The governor added that the national energy policy committee would be able to find the best solution if oil prices in the world market keep spiralling.

The government recently announced that it would keep diesel prices below 30 THB per liter until the end of April 2011.

Dr Prasarn explained that the expansion of many emerging economies had led to rising demand for oil and other commodities while the production capacity remained limited. The situation had driven prices of oil and consumer goods to adjust up continuously.

The governor admitted that the mentioned global development was another factor affecting the Thai economy this year, and many countries were trying to calm down the situation in order to avoid losing their trade balance.