BANGKOK, THAILAND – Diesel prices in Thailand surged sharply, overtaking common gasoline blends and adding pressure on households and the economy.
Fuel prices in Thailand continued to climb, with diesel seeing the steepest increase. The diesel price rose by 3.50 baht per liter, significantly more than the hikes for gasoline and Gasohol products.
According to PTT, diesel increased to 44.24 baht per liter. Gasohol 95 went up to 43.25 baht, and Gasohol 91 climbed to 42.88 baht.
From now on, diesel became more expensive than the widely used Gasohol 91 and 95. While Gasohol prices rose by a moderate 1.20 baht, the sharp diesel increase created new dynamics in the market.
Motorists who filled up before the change saved money. The higher diesel rate was expected to ripple through transport and consumer prices.
Energy price surge linked to Middle East conflict
The sharp rise in fuel prices was directly linked to a major escalation in the Middle East. Fears of a direct involvement of Iran in regional conflicts put oil markets on high alert.
Because Iran played a key role in the stability of the producing region and in securing sea routes such as the Strait of Hormuz, global crude prices reacted with strong premiums to every threat. The heightened risk perception translated into immediate cost pressures for import-dependent countries.
This uncertainty forced Thai energy providers such as PTT to pass higher import costs straight on to consumers. As global markets fluctuated, the impact on Thailand’s local market was particularly severe.
With reserves expected to tighten if tensions persisted, the political leadership came under pressure. The dependence on world oil prices pushed the national inflation rate dangerously higher.
Political instability and economic strain
The fact that diesel was now more expensive than Gasohol 91 and 95 posed a significant political risk for the government. Diesel powered most of the Thai economy, with nearly all freight transport and logistics relying on this fuel.
When transport costs rose so sharply, a wave of price increases for food and consumer goods became unavoidable. This further weakened the already strained purchasing power of the population.
Politically, the government struggled to justify its position as diesel subsidies became increasingly unsustainable at this level. There was a risk of social tensions and protests, particularly from the transport sector, if short-term relief packages were not introduced.
The opposition already used the price jumps to criticize the government’s energy policy. It called for greater independence from volatile global market prices and more robust mechanisms to shield consumers.
Songkran travel warning: costly holidays ahead
The timing of the price hike in early April was seen as especially problematic, as Thailand approached the Songkran festival. During this period, the largest travel wave of the year took place, with millions of people leaving the cities for their home provinces.
The steep fuel costs threatened to blow the travel budgets of many families. Private travel was expected to decline noticeably, or people might switch to already overloaded public transport.
Closely linked to this was concern over long-distance bus fares. Since interprovincial bus operators depended directly on diesel prices, an adjustment of ticket prices was considered almost unavoidable.
If the government did not enforce a cap on fares during the holidays, travelers would likely face steep surcharges. This would not only make family visits more difficult, but could also significantly dampen domestic tourism, which usually boomed around Songkran.