Bangchak dumps B5 amid scarce palm oil

The current shortage of crude palm oil (CPO) and resulting price increases in Thailand has led to a tight supply of biofuel, forcing Bangchak Petroleum Plc (BCP) to temporarily drop B5 (a 5% palm biodiesel mixed with 95% petroleum-based diesel fuel) from its service stations. President Anusorn Sangnimnuan said the cut would help lower demand for CPO, which is used as a biodiesel feedstock, by 1.2 million liters per month. Bangchak stations will keep B3, a 3% biodiesel blend. Bangchak will resume sales of B5 when palm oil supplies improve. Since December, the Energy Ministry has attempted to ease the shortage by reducing its subsidy of B5 from one baht (US$0.03) to 30 satang (US$0.30) a liter, resulting in lower B5 consumption. Bangchak sells 84 million liters of B3 a month and 60 million liters of B5. Other major oil traders such as PTT and Shell still have B5 available. (January 28, 2011)