Social Media Furor Hits Oil Giant as Fuel Costs Squeeze Thailand
(Bloomberg) -- Thailand has joined the global wave of anxiety over climbing energy costs.
A social media furor over pump prices erupted in the past week, prompting state-run oil refiner PTT Pcl to defend itself in a Facebook post by Chief Executive Officer Tevin Vongvanich. Last Thursday, the country’s military government rolled out fuel subsides for diesel and cooking gas.
The developments signal Thailand’s nascent consumer-spending recovery, which helped the economy last quarter, remains vulnerable to the climb in crude oil. The kingdom is among the latest examples of a spike in energy angst around the world: Brazilian truckers have protested over diesel, Indian fuel makers face ire for raising prices and some Philippine lawmakers want to rollback a tax on petroleum products.
“Some Thais may feel more pain from oil this time as the increase in agricultural product prices isn’t keeping pace with the advance in crude,” said Kampon Adireksombat, the chief economist at Kasikorn Securities Pcl in Bangkok. “People on low incomes are still having a difficult time.”
Agriculture accounts for about 8 percent of Thai gross domestic product and a third of total employment, according to World Bank data. Inflation in Southeast Asia’s second-largest economy probably accelerated to a 15-month high of 1.3 percent in May, a Bloomberg survey shows ahead of data due Friday.
Thais on social media over the past week called for a boycott of PTT gas stations, and some hurled wild accusations that led the firm to threaten legal action against false claims.
Tevin in a Facebook post said people are mistakenly making PTT the culprit for the jump in global oil prices. The company is Asia’s biggest oil and gas firm by market capitalization outside of China and India.
The junta said last week it will use the state oil fund to subsidize cooking gas prices and cap diesel at a maximum 30 baht (93 U.S. cents) per liter. Rising living costs together with elevated household debt raise the risk of disquiet over military rule. Long-delayed elections are due next year.
©2018 Bloomberg L.P.