The Fuel Fund Executive Board has approved a subsidy and will use a refinery margin discount of 2.40 baht per litre to manage and freeze retail prices for all diesel and gasoline products, preventing them from rising in line with global markets, from 24 July to 15 August 2026. The total cost is estimated at 3.892 billion baht. This decision comes in response to surging global oil prices driven by conflict in the Middle East and the blockade of shipping routes in the Red Sea. Diesel prices in the Singapore market have soared to 167.62 US dollars per barrel, while gasoline has reached 128.33 US dollars per barrel, equivalent to an increase of around 8 to 10 baht per litre over the past one to two weeks. The board stated that this measure acts as a shock absorber to ease the cost-of-living burden on the public and will continue to monitor the situation closely.
Article states global oil prices are surging due to Middle East conflict and Red Sea blockade, which would normally push Brent higher, but the Thai fuel price freeze is a local subsidy that does not affect global supply-demand; however, the underlying geopolitical tensions are the driver of the price surge mentioned.
Similar to Brent, RBOB gasoline prices are affected by the same geopolitical supply disruption (Middle East conflict, Red Sea blockade) causing global gasoline prices to rise, but the Thai freeze is a local measure not impacting global RBOB pricing.