New measures to counter oil impact

"We're urgently formulating measures to cope with the situation," he said, adding low-interest loans and tax credits were among proposals to counter record high crude prices.

The minister yesterday held a meeting of top officials from the Bank of Thailand, the Budget Bureau and other agencies. He suggested it was necessary to use pricing mechanisms to influence changes in petrol consumption.

NGV or natural-gas vehicles will be more widely promoted with tax benefits and other incentives. For instance, the price of NGV tanks could be reduced by half from the current Bt50,000 to about Bt20,000-Bt30,000.

He said the current oil prices, which had already affected second quarter growth, were unexpected, beating all projections.

As a result, the government needs to minimise its impact on growth - projected at 6 per cent for this year - by introducing measures for people and businesses to alter their oil consumption patterns.

"We now need to change consumption behaviour by saving energy or using alternative fuels. We'll also adopt measures to improve city bus operations," he said.

The Finance Ministry will soon hold a joint meeting with other key ministries on the matter.