BANGKOK, THAILAND – Thailand’s government raised fuel prices in small steps from 18 March while vowing to keep diesel capped at a maximum of 33 baht per litre.
Small price increase from 18 March
On 17 March, Phiphat Ratchakitprakarn, acting deputy prime minister and transport minister, announced that petrol and diesel would become slightly more expensive from the morning in increments of a few satang. According to the government, petrol prices had already risen over the previous one to two weeks, while the formal adjustment for diesel started on 18 March.
Diesel prices below the cap before the change
The retail diesel price on 16 March stood at 29.94 baht per litre, remaining below a state price cap that had been in force from 3 to 17 March. Officials stressed that under the new framework diesel should still not rise above 33 baht per litre.
Oil stocks cover roughly three months
Government figures indicated that on 16 March the country held oil reserves sufficient for 96 days, while the Energy Ministry in some statements spoke of up to 100 days. Additional procurement had increased the reserve from about 90 to 95 days, with deliveries coming from the United States and Africa among other markets.
Why pumps still ran dry
Despite the overall supply being adequate, shortages were reported at individual stations, which authorities attributed mainly to distribution problems rather than a lack of fuel. Around 10,000 branded stations such as Shell, PTT, Susco, Bangchak and Caltex continued to receive supplies, while some 23,000 independent and small village stations temporarily ran out and motorists switched to the larger chains.
Panic buying overwhelms logistics
According to the authorities, panic buying pushed demand to between two and three times normal levels, overloading supply chains. Tanker trucks could not keep up due to safety rules and limited driving hours, and some routes were restricted to night-time transport, forcing stations to close temporarily or sell out of certain grades.
Refineries at full capacity and round-the-clock deliveries
Refineries were running at 100 percent capacity, according to official statements, and had been asked to increase output further where possible. Delivery companies were instructed to operate 24 hours a day for seven consecutive days, while the government worked on relaxing time windows for tanker truck operations and expanding pipeline transport.
Cabinet weighs new fuel formulas and cheaper B20
The cabinet planned to discuss further measures, including a possible extension of price caps and changes to fuel composition. Proposals under consideration included restructuring diesel in a way similar to petrol blends E10, E20 and E85, as well as offering B20 diesel for industry, transport and agriculture at an estimated 4 to 5 baht per litre cheaper than B7.
Oil Fuel Fund deep in the red
The Oil Fuel Fund was reported to be running a deficit of more than 12 billion baht, which authorities aimed to keep from rising above 40 billion baht, after previous peaks of around 100 to 120 billion baht. To stabilise prices, a loan of more than 40 billion baht from state banks was being considered, while total financing needs were estimated at around 100 billion baht and larger sums could require state guarantees.
Crackdown on gouging and talks on Russian oil
In parallel, authorities monitored possible hoarding and warned that bulk buying for resale and price gouging were illegal and would be punished. At the same time, officials said supplies remained sufficient but they were examining additional crude oil purchases, including potential deliveries from Russia following talks in Austria on 16 March.