The Thai government is considering lowering excise taxes on biofuels to push prices down and boost consumption.

The Ministry of Energy and the Ministry of Finance are drafting a tax reduction plan, said Pongpol Yodmuangcharoen, a spokesman for the Ministry of Energy, at a Wednesday press conference.

Pongpol said biofuels are made by blending gasoline or diesel with biomass fuels and can be produced locally at low cost.

The excise tax on bio-gasoline and bio-diesel is about 6 baht per liter.

Expanding the use of biofuels will help reduce crude oil imports and ease the pressure on government fuel subsidies.

Thailand's State Oil Fund currently has a deficit of about 100 billion baht, mainly due to subsidies for diesel and liquefied petroleum gas, which are used to protect consumers from high international energy prices.

Pongpol said that as long as crude oil prices remain around $100 per barrel, the fund can continue to bear the subsidies and the deficit.