The current economic slowdown is the right time for companies to speed up their investments in energy infrastructure, while the government should use the period to restructure price mechanisms, says PTT Plc.

This is the time to cut our reliance on energy imports as much as we can. Prasert Bunsumpun, President & chief executive, PTT Plc

Lower construction costs increase the appeal of investments in areas of energy infrastructure, and in clean and renewable energies such as clean development mechanism (CDM) projects, said Prasert Bunsumpun, the president and chief executive of the majority state-owned energy company.

"Companies should accelerate developments of projects in the pipeline during 2009 and 2010 in order to reap the benefits when the economy rebounds, hopefully in 2010, which would send oil prices up," he said at the Post Today Investment Expo yesterday.

He forecast that global oil prices would stay in a range of US$35 to $50 per barrel this year as world consumption has dipped by 1.5 million barrels per day from 2007. The forecast is far below the aim of the Organisation of Petroleum Exporting Countries (Opec), which hopes to see a price of $75 by cutting its members' annual output by two to three million barrels per day.

Crude oil rose for a second day in New York yesterday after Opec's president said the group may reduce output further to trim stockpiles.

Crude oil for March delivery rose as much as 35 cents, or 0.9% to $41.13 a barrel in electronic trading on the New York Mercantile Exchange. Prices are still down 8% this year and 54% from a year ago.

However, Mr Prasert pointed out that 2009 would be the second year in a row in which global crude demand would decline, to an average of 84.3 million barrels per day from 85.8 million last year and 86 million in 2007.

He said that companies should also take advantage of the slow economy to focus on human resources development, because talented people would be the key drivers of business growth once the economy recovers.

As well, he said, the government should take the opportunity of current low oil prices to adjust the country's oil price structure.

"The restructuring could be done by using the mechanism of taxes and the Oil Fund," he said, adding that liquefied petroleum gas (LPG) prices should also be managed under the free market system instead of being subsidised by PTT.

By allowing energy prices to rise to reflect the actual cost, it would help reduce the country's import bills, he said. "This is the time to cut our reliance on energy imports as much as we can."

Discussing PTT's financial results of 2008, he said all of the group's refineries would post losses from inventories due to the sharp decline in oil prices in the fourth quarter.

"The drastic stock loss experienced in the last quarter would wipe out all stock gains recorded in the first three quarters," he said.

PTT shares closed yesterday on the Stock Exchange of Thailand at 165 baht, up 10 baht, in trade worth 1.68 billion baht.