Thailand cuts NGV retail prices to reflect lower gas costs

BANGKOK, May 18 (Reuters) -- Thailand cut the retail price of natural gas for vehicles (NGV) on Monday following a fall in gas costs, in line with government policy, said state-controlled PTT, the country's sole gas supplier.

The NGV retail price was cut by 0.73 satang to 12.63 baht/kg ($0.3567) on Monday, the third reduction since a decision in March to allow floating NGV prices to better reflect changes in actual gas costs, the energy giant said in a statement.

The flotation in NGV prices is seen as a positive move for PTT, Thailand's sole gas supplier, which has had to shoulder losses from government fuel subsidies for years.

PTT said the flotation will support a government plan to liberalize the NGV business and encourage more players.

PTT said lower gas costs helped it limit losses on its NGV business in the first quarter, without giving details. Analysts expect the company took a loss from NGV of 1.29 billion baht ($36.4 million) for the quarter, from 3.3 billion baht loss a year earlier.

The military government has gradually raised retail gas prices since late 2014 to reflect actual costs as part of energy reform. Retail prices of liquefied petroleum gas (LPG), for example, already reflect average costs, according to the energy ministry.

LPG and NGV accounted for about 17% of total land transport fuel in the first two months of this year, the ministry data showed.

($1 = 35.4100 baht)

(Reporting by Khettiya Jittapong; Editing by Richard Pullin)

• Most Read
• Most Commented