Tuesday, July 1, 2008

LPG shortages : another symbol of mismanagement




It's Economy 101. Even Psychology 101. But still too difficult to understand for the thai authorities.


Since a few months, we know that prices of LPG will increase in july. PTT was very clear. But not the government, as usual.


The subsidies cost too much (read here).


In order to avoid hoarding, they refused to gives details (how much, and when exactly).


It was a mistake. Because people can fantasize.


It would have been more efficient to say “LPG prices will increase on july 1, by %”. But such transparency would have created “inflation expectations”, right ? Exactly like with NGV (+41 % announced for end of december).


The government is so terrified that they try to postpone to the very last minute any prices hikes.


And since a few days... well... we have shortages (read testimonies of drivers in Bangkok, on ThaiVisa forum, and in Pattaya).


Because hoarding and probably because of mismanagement of imports.


The Energy Ministry warned dealers on Sunday against hoarding liquefied petroleum gas (LPG), as thousands of taxis had to stop running because of the hoarding.


Permanent Secretary for Energy Pornchai Rujiprapa said he was confident that there would be no LPG shortage in the country but he did not address hoarding for a suspected price rise on Wednesday.


Taxi drivers told passengers that gas stations had shut down on Saturday amidst reports that the price of LPG will be allowed to float as of Wednesday (July 1). They expected the cost to double from 11 baht to 22 baht per litre. (Bangkok Post)


Another disaster, perfect symbol of mismanagement and utter stupidity ! I mean it's becoming laughable.


There is no point to warn dealers, after the war, with the little fists of the Energy Minister... And there is no point to deny the problem of shortage.


The only solution was to play transparency card, right from the beginning, with full disclosure of all the datas, in order to allow people to anticipate.


But Thailand continues on the Zimbabwe's path. With a smile.


UPDATE 1

The Commerce Ministry also shows his little fists. Commerce Ministry permanent secretary Siripol Yodmuangcharoen Sunday said he received a report from the Internal Trade Department that some operators had been hoarding the LPG ahead of the price hike.


“Such hoarding is illegal,” Siripol said, “We will take harsh actions against the offenders”. (Nation)


UPDATE 2

The little game continues this morning : “Permanent Secretary for Energy Pornchai Rujiprapa on Monday affirmed that prices of liquefied petroleum gas (LPG) or cooking gas would not be raised by July 1 as many expected, but conceded they would be revised within a month.. (TNA).


Director-General of the Department of Internal Trade says the price of liquefied petroleum gas (LPG) will not decrease on July 1st as the Energy Policy Board has yet called a meeting to discuss the price hike. (PRD)


It's crystal clear ! They need to organize... a meeting in order to set the date for the increase... ;-)


UPDATE 3

About one fifth of Bangkok's taxis had to stay idle Monday after many service stations ran out of liquefied petroleum gas (LPG). “There's nothing to fill these taxis' tanks,” Siam Taxi Cooperative president Witoon Naewpanich said. (Nation)




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