Leesombatpiboon, Poonpat

Summary
Oil crises occur in two forms: high oil price shocks and or oil supply disruptions. High oil prices may not coincide with oil shortages but oil shortages will rapidly lead to higher oil prices. As oil crises usually create both economic and concerns on oil supply security are extensively discussed among oil-importing nations. Thailand has experienced a remarkable record of economic growth during the past three decades. The level of oil consumption has risen considerably to propel economic growth by more than five-fold since 1976, which leads to a growing dependence on oil imports from the Middle East where the geopolitical situation has been unsettled. The fear of oil disruptions has escalated. Consequently, the Thai government has considered establishing a Strategic Petroleum Reserve (SPR) to provide the government with an effective policy option for managing an oil crisis. However, the question remains as to how much of today s resources should be sacrificed in order to ensure a smooth path in the future.