Oil prices opened yesterday at a record of above US$73 (Bt2,760) a barrel amid growing concern about Iran's nuclear ambitions and declining US petrol stocks.

Somkid Jatusripitak, commerce minister and deputy prime minister, called an urgent meeting with retailers and refiners to draw up measures to ease the shock. The meeting agreed that the oil-traders would reintroduce petrol coupons or fleet cards for 20,000 buses, which would be entitled to the diesel at Bt1 per litre cheaper.

Prasert Bunsumpun, president of PTT Plc, said the largest distributor was willing to participate in the coupon programme to ease the situation.

Somkid insisted that the government would not intervene in the oil market but would try to cooperate with dealers to relieve the distress of higher prices.

The government has asked bus-operators not to raise fares again as this would hurt commuters.

Light, sweet crude for June delivery, which became the front-month contract yesterday, opened in Asian electronic trading at a high of $73.50 a barrel, setting a new intraday record for a front-month contract on the New York Mercantile Exchange.

In Thailand retail oil prices have hit historic highs. Premium and regular petrol are selling at Bt28.34 and Bt27.54 a litre respectively. High-speed diesel costs Bt26.69 a litre. Pump prices at state-owned oil and gas conglomerate PTT are Bt0.40 lower than at other companies.

At yesterday's meeting it was agreed that the oil-traders would  plan to reintroduce petrol coupons ("the fleet card") as a temporary measure to ease the impact on bus-operators of the current price surge.

Details remain vague as to how the coupon scheme will be implemented, but the oil companies, which issue the coupons, will have to bear the burden of the discount of Bt1 per litre of diesel. The oil companies will try to finalise the details and kick off the programme before the end of the month.

The meeting agreed to try to finalise the coupon scheme next week, conceding it would have to be carefully implemented to prevent abuse.

Somkid said the government would not intervene in the oil-price movement, adopt an excise tax policy or set up an oil fund but let the oil price float according to the market mechanism.

Viroj Mavichak, managing director of Thai Oil Plc, said he was happy to learn that the government would not try to dictate fuel and refinery prices. Ways the oil companies could help include issuing petrol coupons to transport operators, he said.

Theerapot Vajarabhai, chairman of Shell Corp (Thailand), expressed support for the discount scheme but added that it should be short-term, lasting only two to three months. "We have to come up with clear guidelines to avoid others taking unfair advantage of the coupons, as we've seen in the past," he said.

Somkid also consulted with Energy Minister Viset Choopiban, Permanent Secretary for Commerce Karun Kittisataporn, senior officials from the Energy Planning and Policy Office and the Electricity Generating Authority of Thailand and representatives of oil-traders and refiners.

Somkid reiterated that the government was not considering cutting the excise on petrol and diesel, currently Bt3.68 a litre on petrol and Bt2.30 on diesel.

The government will not resort to tax measures to cushion price hikes because the current rates are effective, he said. "Tax measures might affect the government's budget," he said.

The government asked oil-retailers and refiners to discuss how to set guidelines to assist trawlers, farmers, SMEs and transport-operators, who would take a direct hit.

Somkid said traders had successfully reduced oil imports, leading to a trade surplus of more than $324 million in March. In the medium to long term he asked the Energy Ministry to come up with a strategy in line with the price rise.

Somkid said this was the first time oil-traders and refiners had agreed to seek common measures to help operators in the four economic segments that drove the economy at a low level.

Oil-traders will reconvene next week to come up with tangible measures.

Viset shrugged off mounting concern, saying all oil-traders still had sufficient supply at their service stations except for some very small stations in the provinces that preferred to buy fuel from jobbers, who set high prices.

Prasert said PTT was willing to take up the burden of the price hike at an appropriate level, noting that since the company left its prices unchanged on April 9 it had had to absorb a loss of around Bt150 million.

He said oil prices had risen so unusually that pump prices could not keep up with the hikes in ex-refinery prices. It will take some time for fuel prices to reach equilibrium, he said, warning that PTT would not be able to cap fuel prices for long.

Theerapot said Shell was facing a negative marketing margin of around Bt2 a litre, so it had no choice but to raise retail fuel prices in due course, perhaps by Bt1-Bt2 a litre.