The Russia-Ukraine military conflict has given rise to surging energy prices worldwide with the price of oil now at its highest level in almost 14 years.
In turn, fuel price hikes are affecting production and transport costs of many consumer items and driven prices skyward. The Monetary Policy Committee has increased its inflation projection to 6.2% this year in Thailand, up from an earlier 4.9% outlook, due to rising-cost pressures.
Boonsithi Chokwatana, chairman of the Saha Group, one of the country's largest consumer goods manufacturing conglomerates, said last week the impact of the Russia-Ukraine war on production cost is more intense than that of the "Tom Yum Kung" financial crisis 25 years ago. He says the group has no choice but to seek permission to increase prices, including that of instant noodles, a staple among low-income people struggling to make ends meet.
In such circumstances, Prime Minister Prayut Chan-o-cha saw fit last week to send out government spokesman Thanakorn Wangboonkongchana to convey the message that fuel prices in Thailand are by no means the most expensive among Asean members.
It is true that fuel prices in some neighbouring countries are higher than in Thailand. However, an accurate measure of hardship can't be obtained given the disparities in income per capita across Asean countries.
Moreover, claiming that oil prices in Thailand are lower than in other countries is not the way for the government to solve an energy crisis. What's needed are direct, practical actions.
As there is no sign the Russia-Ukraine conflict will end soon, and since Thailand is not a rich country, long-term oil price subsidies are impossible. Instead, one of the most effective ways for the government to help is to focus on energy conservation and efficiency.
For example, the diesel price is now about 34 baht per litre. If all diesel consumption was cut by 10%, it would be tantamount to shaving off 3.4 baht per litre of the fuel.
Unfortunately, there is no a serious government policy on fuel conservation. According to Mr Thanakorn, Gen Prayut has asked everyone to save as much energy as possible and join hands to support one another during this trying time.
In fact, the burden has fallen almost solely on individuals to save energy due to rising oil prices. So one question put to the government should be: What have you done to promote energy conservation and energy efficiency?
The International Energy Agency recently proposed a 10-point practical action plan for governments and citizens to achieve significant reductions in oil demand and reduce the risk of a major supply crunch.
The actions are: 1) reduce speed limits on highways, 2) work from home up to three days a week, 3) establish car-free days in cities, 4) make the use of public transport cheaper and incentivise micro-mobility, 5) alternate private car access to roads in large cities, 6) encourage car sharing, 7) promote efficient routes for freight trucks and delivery of goods, 8) reinforce the adoption of electric and more efficient vehicles, 9) use high-speed and night trains instead of planes where possible and, 10) avoid business air travel where and when options exist.
Not all these proposals are practical for Thailand. What's important, however, is that the government take action. Fuel conservation must become part of the national agenda, public awareness promoted, and practical energy saving actions taken.
