The committee managing the Oil Fuel Fund yesterday approved a proposal to raise the diesel price cap from 30 baht per litre to 32 baht from Sunday, prompting a transport association to threaten to raise their service fees by 20%.
As well as raising the price cap, the Energy Ministry, Oil Fuel Fund Office and other organisations will keep a close watch on global oil prices and make a weekly assessment on whether the price cap needs to be raised further, energy permanent secretary Kulit Sombatsiri said.
If so, the diesel cap will climb by no more than 1 baht a week, while the new ceiling of the price cap will become 35 baht per litre despite the actual price of diesel already being well over 40 baht per litre, he said.
Prime Minister Prayut Chan-o-cha, meanwhile, implored people to understand the need to raise the diesel price cap, government spokesman Thanakorn Wangboonkongchana said.
Gen Prayut admitted the government has already used up tens of billions of baht from the oil fund to subsidise diesel prices over the past few months.
Loans sought previously to also subsidise diesel prices have already been used up as well, said Gen Prayut, adding the government has been dedicating resources to supporting the diesel price subsidy because it is a major cost of consumer products and services.
A source at the Northeastern Transport Association said the association, which has more than 700 cargo transport companies as members operating more than 10,000 trucks, now plans to raise cargo transport fees by 20% in order to cope with the expected jump in fuel costs.