Thailand Absorbs 92 Billion Baht Deficit to Cushion Retail Fuel and Cooking Gas

Thailand is subsidising retail diesel by 4.95 baht and gasohol by 4.20 baht per litre. The support has pushed the state energy fund into a 92.2 billion baht deficit.

Cooking gas is capped at 423 baht per 15-kilogram cylinder through 31 October. That ceiling shields transport fleets, households and street food operators from volatile crude markets.

Deficit Pressures on the Oil Fuel Fund

Accumulated net losses at the state-backed Oil Fuel Fund reached 92.2 billion baht on 20 September. Higher crude prices drained cash as the fund held down retail caps on transport fuel and liquefied petroleum gas nationwide.

Energy permanent secretary Prasert Sinsukprasert confirmed the ministry will avoid sudden market pass-throughs. If crude stays high, authorities will raise pump prices in small increments to ease pressure on the state ledger.

Biofuel Shift and Targeted Tax Relief

Future tax relief will focus on renewable blends rather than blanket cuts across all transport fuels. Finance Minister Ekniti Nitithanprapas said upcoming excise reductions will target gasohol E20 and biodiesel B20, both made from domestic agricultural feedstock.

Gasohol E20 blends 20 per cent ethanol derived from local cassava and sugar cane. Biodiesel B20 uses 20 per cent palm oil methyl ester. Both fuels receive higher fund subsidies than lower-percentage blends, tying relief directly to farm earnings.

What It Means for Retail and Fleet Costs

For logistics fleets, delivery operators and restaurant owners, the subsidy keeps overhead predictable. Street food vendors rely on 15-kilogram LPG cylinders to protect daily margins, making the 423 baht cap critical for urban food pricing.

This strategy creates a commercial preference for domestic biofuels over imported petroleum. Commercial fleet operators will find stronger financial incentives to switch trucks and delivery vans to B20 and E20 as taxes align behind local crops.

Power Tariffs and What to Watch Next

Power regulators will use the fuel tariff adjustment mechanism to manage utility bills against imported liquefied natural gas costs. They review the rate every four months to reflect actual fuel expenses and policy costs.

Any excise tax cuts from the Energy and Finance ministries will take effect in fiscal 2027, starting 1 October. Before then, the retail price cap on cooking gas expires on 31 October.