Activists slam oil pricing formula, demand reform

A people’s sector network today called on the government to accelerate oil price restructuring to ensure fair fuel prices for consumers.

The group also submitted eight proposals to Energy Minister Akanat Promphan, aimed at easing the financial burden of rising oil prices.

Panthep Puapongpan, chairman of the Motherland Watch Foundation, said the use of Singapore oil prices as a benchmark for determining domestic prices does not reflect the actual cost of refined oil products.

In reality, he noted, there are no transportation or insurance costs for shipping finished oil products from Singapore to Thailand.

He said the gross refining margin (GRM) for April should be 2 baht per litre, instead of the 16.40 baht per litre currently charged by oil refiners. He added that the Oil Fuel Fund continues to subsidise refiners.

One proposal is to cap the GRM at no more than 2.50 baht per litre. Another calls for ending the blending of biofuel in diesel and ethanol in gasoline, arguing that biofuels reduce fuel efficiency by about 10 percent compared to standard fuel.

The network also proposed scrapping the use of Saudi Arabian price references to determine household LPG prices, noting that LPG is locally extracted and refined rather than imported from Saudi Arabia.

It further urged the government to issue an executive decree empowering the Oil Fuel Fund Executive Committee to reclaim windfall profits from oil refiners.

Panthep said there is no need for the government to secure a 150-billion-baht loan to support the fund, as taxpayers would ultimately bear the repayment burden.

Additionally, the network proposed that the Metropolitan Electricity Authority and the Provincial Electricity Authority purchase surplus electricity generated from rooftop solar panels through a net billing system.