BANGKOK, THAILAND: The government has raised retail petrol prices by 60 satang a litre from today in line with rising global oil prices.

The new price for subsidised premium petrol is 20.59 baht, compared with the actual price of 21.31 baht, and regular petrol is now 19.79 baht, compared with 20.60 baht. The subsidised price for diesel remains capped at 14.59 baht, compared with 19 baht a litre.

The government's subsidy of retail oil prices has reached 23.23 billion baht.

Energy Minister Prommin Lertsuridej said yesterday the government would continue the freeze on the price of diesel until the end of the year.

He said the cost of the oil subsidy could reach 40 billion baht by the end of the year. He confirmed the government would later consider what to do with the diesel price, and said energy-saving measures were now necessary.

Motorists would be asked not to drive over 90kph and encouraged to use public transport. The Land Transport Department would act as a coordinator to minimise trips made by empty trucks.

As a medium-term measure, the government and PTT Plc would promote the importation of trucks and buses which use natural gas. For the long term, the government would promote the use of locally made ethanol and bio-diesel.

Mr Prommin confirmed the government would continue to subsidise the price of cooking gas. The subsidy stands at slightly over two baht per unit.

He also said the government would not adjust oil taxes.

Government spokesman Jakrapob Penkair said Prime Minister Thaksin Shinawatra has ordered the energy minister to urgently discuss with the relevant authorities the best way to cushion the impact of rising fuel prices.

On energy-saving measures, he said the directive that petrol stations close at midnight had not worked. These stations had resumed 24-hour service to remain competitive.

Blacking out advertising hoardings after 10pm fared better, as 728 boards met the directive. Changes to vehicle taxes were expected to encourage people to buy smaller cars.

Deputy Commerce Minister Pongsak Raktapongpaisal said a number of fuel refiners had sought permission to raise prices but were rejected after surveys by ministry staff showed only slight increases in the cost of imported raw materials.

Industry Minister Pinit Charusombat said factories were cooperating well with the energy-saving campaign and their energy consumption had dropped by 15-17%. The fuel price increase would not affect most factories as production depended on electricity, he said.

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