Here is the latest gas prices after the government removes subsidies and increases the price of fuel by 6 baht.
The Federation of Thai Industries (FTI) warned of significant consequences on Thursday for production costs and consumer prices.
Manufacturers understand global crude oil prices have surged, driving retail fuel costs upwards, said Apichit Prasoprat, vice-chairman of the FTI.
However, he criticised the government for implementing such a steep increase all at once, calling it “a dramatic rise” that will burden businesses across multiple sectors.
According to the FTI, higher diesel prices will directly raise logistics costs. An increase of 1-2 baht per litre could hike logistics expenses by 1-3%, while a 2-4 baht uptick could lift costs by 5-12%. A 4-baht rise would drive logistics costs up by as much as 15-20%, noted the group.
With the government’s 6-baht increase in diesel prices, businesses are bracing for even heavier financial strain, said Mr Apichit.
He warned consumer product prices will inevitably climb by at least 5-8% in the near future, as manufacturers can no longer absorb the added expenses.
Some companies may even be forced to temporarily suspend operations due to soaring fuel costs and shortages of certain raw materials, said Mr Apichit.
Seafood processing is expected to be hit particularly hard, as fishermen face higher fuel bills when going out to sea, which will translate into more expensive processed seafood in the market, he said.
Source: Bangkok Post