The Energy Policy Administration Committee (Epac) has decided to cut retail oil prices by another one baht per litre for both gasoline and diesel segments from Tuesday, says Energy Minister Siri Jarapongphan.
"Energy policymakers want to ease people's transport burden over the New Year holiday," he said.
Epac decided on two discount measures. The first is a 50-satang per litre reduction in levy collection for the State Oil Fund for oil user accounts, and the second is 50-satang per litre reduction requested by oil traders to narrow their marketing margins from 2.6-2.7 baht per litre.
But Mr Siri said the levy collection reduction will take roughly four months.
The price of gasoline 95 will fall to 33.56 baht per litre, while gasohol 95 and 91 stand at 26.15 and 25.88 baht per litre, respectively.
The E20 and E85 will decline to 23.14 and 18.94 baht per litre. Diesel will drop to 25.29 baht per litre.
But the natural gas price will remain unchanged at 16.06 baht per kilogramme.
Mr Siri said Epac has been monitoring the global oil price situation since late September and it has seen a continuous downside trend. US sanctions against Iranian oil exports have been lifted in some situations, but oil prices are slipping, he said.
"Global prices have hit the lowest point in 17 months, increasing the market margin for oil traders," said Mr Siri.
Oil prices are expected to further decline on weakening economic growth and surging US oil supply will lead to a surplus in January. The increasing supply also covers the Opec and non-Opec.
"With those factors, the Dubai crude oil dropped from US$80.05 per barrel on Sept 26 to $53.56 per barrel on Dec 21," Mr Siri said.
On Monday Epac did not change liquefied petroleum gas (LPG) prices, even though the cap on LPG prices will end on Dec 31.
In June, the Epac decided to subsidise the fuel, also known as cooking gas, for local consumers, keeping the price at 363 baht per 15kg cylinder.
Cooking gas prices are being subsidised by oil consumers because the state Oil Fund's cooking gas account has been depleted.
Epac also approved borrowing cash from the oil user account for the cooking gas account in order to maintain the price at 363 baht.
Epac estimates the total cross-subsidy will not exceed 6.5 billion baht until Dec 31.
The cross-subsidy programme was previously terminated in 2014 after being in place for a decade, during which time massive debt was accrued by the cooking gas account.
Mr Siri said the State Oil Fund has become more stable following the oil price decline.
Epac aims to collect 40 billion baht for the fund to stabilise energy prices in the future, he said.
The committee reported the State Oil Fund has cash on hand of 29 billion baht.