Substantial cuts in crude oil supplies to Thailand have plunged the country into the worst energy crisis since the Second World War.
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Background: Substantial cuts in crude oil supplies to Thailand have plunged the country into the worst energy crisis since the Second World War.
Consumption has been reduced by 30 per cent while prices have risen by more than 50 per cent in the past few months.
The shortage is the result of sharp cuts in supplies by the Organisation of Oil Producing and Exporting Countries (O.P.E.C.), which mainly represent the Arab oil producers. Supplies to Thailand's three refineries have been reduced by 12 to 30 per cent. Stocks of crude oil are expected to run out in about two months if consumption continues at its present rate,s and the situation is expected to become acute in January.
The biggest local shortage is in diesel and fuel oils, used mainly by buses, trucks and industries. And because Thailand depends on hydro electricity for only a quarter of its power, the fuel shortage threatens to bring the nation's industries to a standstill.
For most Thais, it will be an uncomfortable summer. Government restrictions include a ban on air-conditioners, which are estimated to consume some 40 per cent of the country's power. Speed limits will be restricted to 70 kilometres per hour (50 miles per hour), and there has been a sharp increase in the tax on benzene which is in plentiful supply. Wood-burning steam locomotives have been brought back into service. The revenue from the increased tax on benzene will be used to subsidise bus transport for low and middle income earners.
The Government has said that it does not consider rationing necessary but preparations are being made in case the situation worsens.