New Thai government to reduce levies to Oil Fund

The incoming Thai government led by Prime Minister-designate Yingluck Shinawatra of the Pheu Thai Party has announced six urgent policies, including cuts in the Oil Fund levies. These levies on three types of fuels were used by previous governments to subsidize the price of gasohol and biodiesel. The Oil Fund currently subsidizes E85 gasohol at 13.50 baht (US$0.44) a liter, biodiesel at 4.05 baht (US$0.13) and E20 gasohol at 1.20 baht (US$0.04) . The Oil Fund also subsidizes other types of alternative energy, such as compressed natural gas and liquefied petroleum gas at a cost of approximately 4 billion baht (US$131.5 million) a month. The Oil Fund is reportedly running a deficit of 22 billion baht (US$723.3 million), as levies have been insufficient to meet subsidy costs. (July 7,2011)