DOEB spots rising fuel consumption in 2018

DOEB spots rising fuel consumption in 2018

Biofuel pegged to lead growth as LNG lags

A PTT worker at a petrol station on Srinakarin Road. New vehicle models are mostly compatible with biofuels. SOMCHAI POOMLARD
A PTT worker at a petrol station on Srinakarin Road. New vehicle models are mostly compatible with biofuels. SOMCHAI POOMLARD

Thailand's fuel consumption is expected to grow by 3.5% this year to 155 million litres per day from 150 million litres last year, thanks to the domestic economic recovery, says the Department of Energy Business (DOEB).

Director-general Witoon Kulcharoenwirat said the growth will mostly come from products other than premium-grade petrol and compressed natural gas (CNG), as motorists now prefer using biofuels.

Mr Witoon said annual fuel consumption will move in line with the country's economic growth.

The DOEB forecasts daily consumption of diesel to grow by 4.4% to 66.5 million litres from 63.7 million litres in 2017, while petrol will grow by 1.6% to 30.5 million litres a day from 30.1 million litres. Jet fuel is poised to grow by 4.3% to 19.3 million litres a day this year from 18.3 million litres in 2017.

Consumption of liquefied petroleum gas is expected to increase by 3.1% to 17.5 million kilogrammes per day from 16.7 million kg, while CNG consumption is expected to shrink by 8.3% to 6.2 million kg from 6.75 million kg.

Lower CNG consumption led to the closure of 24 CNG refilling stations last year, leaving 463 in the country.

The DOEB said gasohol E10, E20 and E85 consumption is expected to rise to a combined 29.3 million litres, while pure petrol or premium-grade petrol use will contract by 10% to 1.1 million litres.

New vehicles are mostly compatible with biofuels, while fossil-fuel-compatible vehicles are set to be retired.

"The business sector, particularly transport operators and the agricultural sector, will lead to growth in diesel consumption, while rising tourism and the expansion of airline routes will drive jet fuel consumption," Mr Witoon said.

He said world oil prices are unlikely to reach US$70 (2,212 baht) a barrel as several research houses have estimated, adding that shale resources in North America will be ready to beef up oil and gas production if the crude price exceeds $65 a barrel.

Shale oil and shale gas production in North America carry relatively higher drilling costs than traditional oil resources.

If the oil price rises above $65 a barrel, it will make drilling costs for shale oil and gas more competitive. More output from shale oil and gas will, in turn, weigh on oil prices, Mr Witoon said.

The global oil price averaged $57.50 per barrel last year. The national oil and gas conglomerate, PTT Plc, estimates that oil prices this year will move in a range of $60-65 a barrel.

The DOEB said Thailand's fuel consumption reached 149.5 million litres a day in 2017, up 2.6% from 145 million litres a day in 2016.

Petrol consumption rose 3.7% to 30.1 million litres a day, with diesel use growing 2.7% to 62.2 million litres, jet fuel use up 4.8% at 18.5 million litres and LPG use up 3.4% at 17 million kg a day. CNG use shrank 12.1% to 6.8 million kg daily.

Mr Witoon said the department may not force oil retailers to phase out premium petrol and gasohol 91, but instead may apply a pricing strategy to encourage motorists to use more gasohol.

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