Thailand threatens refinery price controls as fuel margins spike before Songkran

Thailand plans strict price controls on oil refineries as refining margins surge. Read how the government aims to lower fuel costs before Songkran.

Thailand’s Energy Minister Akanat Promphan is preparing to regulate domestic oil refineries. He threatened to invoke price control laws to combat abnormally high fuel prices. The Thai Cabinet recently acknowledged a report on fuel cost structures and tasked Akanat with resolving the issue. He called an urgent meeting with the Energy Policy Administration Committee and refinery representatives for April 7.

Akanat stated the current high fuel prices are not solely caused by global crude oil markets. The issue stems from Thailand’s ex-refinery pricing system. This system is pegged to refined oil prices in Singapore, which are currently experiencing abnormal volatility. This reliance has caused domestic refining margins to skyrocket.

The refining margin represents the difference between crude oil costs and refined oil prices. Over the past four to five years, this margin stayed at a normal level of two to three baht per liter. The average margin climbed to seven baht per liter in March 2026. Data from the first six days of April 2026 shows the margin surging to between 16 and 17 baht per liter.

The minister emphasized the State Oil Fuel Fund is currently subsidizing retail prices to help the public. He stated the government fund must not be used to shoulder the burden of excess refinery profits.

The Ministry of Energy requested actual cost data from all refineries. Officials will compare this data against real increased expenses such as premiums, insurance, and transportation. The government prepared two measures if investigations reveal refineries are making excessive profits. First, refineries will be forced to return excess profits to the system to help consumers. Akanat clarified this will not be a voluntary donation. Second, the committee is prepared to use executive power and emergency decrees to immediately cap ex-refinery prices.

The government aims to lower fuel costs ahead of the upcoming Songkran festival. Akanat explained retail prices depend on both global market volatility and domestic pricing mechanisms. He noted the domestic mechanism might be distorted. Prices at both the refinery and the pump will be reduced if margins are proven to be an unfair burden on the public.

“Today, Thailand must stop using imaginary numbers,” Akanat said. He insisted on using actual cost figures to ensure fairness for consumers and demand accountability from refineries during this economic crisis.