Assess if the oil is more than 6 months dragging Thai economy to grow less than 3%
Date 13 March 2022 time 21:07
Krungthai COMPASS estimates that if oil power exceeds 6 months, the Thai economy will grow by less than 3% this year.
Krungthai COMPASS Krung Thai Bank estimates that if the prolonged conflict between Russia and Ukraine will support oil prices to rise above 100 dollars per barrel continuously throughout March, just one month before the situation returns to normal. The economy is expected to expand close to the previous view of 3.8%.
If the situation is protracted Supporting higher oil prices until June-July may cause the economy to fall to 3%.
But if dragged for up to 6 months following this The likelihood that the economy will expand below 3% is quite high.
Inflation is likely to remain at a high level for a long time following the transmission of higher domestic fuel prices to offset the fuel fund’s position. in the past Energy prices moved up sharply in line with the global economic recovery. and with the pressure of the Russian-Ukrainian conflict This makes energy prices bounce higher and more volatile. Which is contrary to the tool to maintain the price of fuel in the country to an appropriate level that is more restrictive from the current negative fuel fund position of 24 billion baht (as of March 6) As a result, the government has to expedite the financing of at least 20 billion baht to replace and enhance liquidity for the Fuel Fund. (in conjunction with the excise tax reduction)
Therefore, if energy prices in the world market begin to return to normal Domestic fuel prices will continue to remain at a high level. to bring the difference that has been acquired to pay off the loan debt and compensate for the lost fuel fund
Krungthai COMPASS estimates that many businesses in agriculture, industry, and transportation have been affected by a high percentage of the increase in energy prices. According to the cost analysis through the table of inputs and outputs (Input-Output) 2015 (Figure 11). The more the business sector will bear the cost longer as well. As a result, the profitability of entrepreneurs decreases. This will cause the business sector to tend to push more burdens on consumers as well.
