SET-listed PTT Plc, the national oil and gas conglomerate, plans to revise its 340-billion-baht investment plan after considering the risk global oil prices bring to its future investments.
Chansin: Plans change as prices shift
Last December, PTT set this capital spending budget mostly to fund investment in S-curve industries and support existing businesses that are still growing.
President and chief executive Chansin Treenuchagron said PTT has spent some of the budget, but future spending has to be revised because global oil prices have changed.
"Although prices are still in a rising trend, they have declined for some periods. For example, they dropped from $80 to $60 per barrel in the past couple of months," he said.
"The revised investment plan will be submitted to the agenda for PTT's board of directors meeting next month."
Mr Chansin said PTT should have a well-prepared plan in line with global sentiment as it aims to be strong enough to face risks while growing sustainably in the long run.
He joined a seminar titled "The Annual Petroleum Outlook Forum: Future Energy Moving Together", held by the Federation of Thai Industries (FTI).
PTT's PRISM (petrochemicals and refining integrated synergy management) forecasts the Dubai crude oil price in 2019 will have an upside trend at $70-80 per barrel as global oil prices have to face myriad factors such as the trade war between the US and China and energy policies in major oil-producing countries.
PRISM projects renewable energy is gaining popularity in many countries, resulting in new innovation and technology.
Atikom Terbsiri, president of the FTI's petroleum refining industry club, said oil demand in 2019 will grow in line with the global economy, projected to gain 3.7%.
"Based on this economic outlook, the demand for crude oil worldwide will increase to 1.1-1.3 million tonnes per day," said Mr Atikom, who is also president and chief executive of SET-listed Thai Oil Plc.
The club expects the Dubai crude oil price in 2019 will stay around US$70-80 per barrel because of the trade war. The US and other trade partners can pressure global economic growth and oil demand, said the FTI.
As a result of this perspective, the global crude oil supply will be strained by geopolitical and economic problems in oil-producing countries, he said.
Opec predicts the Asia-Pacific region will drive crude oil demand, led by the two largest economic countries -- China and India.
They will consume roughly 671,000 barrels per day in 2019, up from 613,000 barrels per day this year.
Citing the International Monetary Fund, Mr Atikom said China's economy next year will grow 6.2% and oil demand will stand at 471,000 barrels per day.
India's economic outlook is projected at 7.4% growth for next year, and oil demand is forecast to stay at 200,000 barrels per day.
US economic growth will be 2.5% in 2019 and oil demand will be 140,000 barrels per day, projects the IMF.