Thailand Tackles Oil Vulnerability With Energy Transition Plan

Thailand's economy is vulnerable to oil price swings, with a current account deficit of 17,000-18,000 million baht in the second quarter. The Finance Ministry has been ordered to accelerate discussions on energy transition in public transport to prevent future energy crises. Deputy Prime Minister and Finance Minister Ekkaniti Nitithadprasart revealed that discussions are underway with the screening committee on the use of borrowing authority for energy transition. Projects under review include rooftop solar installations by the Regional Electricity Authority and the Metropolitan Electricity Authority, which should be clarified by the fourth quarter of 2026. Public transport energy transition plans will be discussed with Finance Ministry officials this week (17-21 August). When government agencies request loan authorization for energy transition projects, they will present detailed proposals first, allowing officials to determine which projects qualify for funding under the borrowing decree. Priority is being given to public transport energy transition. "The second quarter current account balance has turned negative, showing a deficit of 17,000-18,000 million baht compared to the previous surplus," Ekkaniti said. "This demonstrates Thailand's vulnerability to oil prices. We import oil, most vehicles use petroleum, and electricity still depends on natural gas for over 65 percent. We must import from the Middle East, so when prices rise, our current account swings into deficit immediately. This reflects a fundamental weakness in the Thai economy." Ekkaniti revealed that this current account deficit is the first in many years, as Thailand has run surpluses since the 1997 crisis, except during the COVID period. The situation reflects structural weakness in the Thai economy. Without accelerating structural change, the economy will remain fragile. When oil becomes expensive, we are hit again. If we do not accelerate the transition, the conflict continues, and we will keep patching problems. If fighting resumes and prices spike again, we will only need temporary relief measures with no real solution. The borrowing decree remains valid for disbursement until 31 December 2027, serving as a jumpstart for the transition. Three policy pillars have been established: energy transition, transport transition, and human capacity development.