Energy panel eyes further Bt2/litre cut in fuel prices this week

The Energy Policy and Planning Committee is scheduled to meet representatives of six oil refiners for the second time this Thursday to discuss a further cut in the Gross Refining Margin (GRM), aimed at reducing the ex-refinery price of finished oil products by two baht per litre, according to Energy Minister Akanat Promphan.

He said he expects the cut to take effect this Friday, adding that the reduction reflects the current abnormal global oil market conditions, which have made the use of the Singapore price reference for refined oil products—used to determine ex-refinery prices in Thailand—unusually higher than production costs.

Akanat insisted that the new ex-refinery prices will not result in losses for refiners, but will instead make prices more realistic and fair to all parties concerned. He added that pricing which allows refiners to earn excessive profits during the current oil crisis is not appropriate.

“This is not a matter of whether oil refiners agree or disagree with the price cut. It is an assessment of the real situation, arising from abnormal global market conditions,” he said.

The energy minister also expressed optimism that the GRM could be cut by more than two baht in the future, noting that the previous two-baht reduction in ex-refinery prices, agreed at the last committee meeting, was based on global oil prices in March.

He added that the pump price of diesel has been reduced four times since the Songkran festival, by a total of 8.84 baht per litre, in line with cuts in ex-refinery prices.

The GRM is the difference between the total value of petroleum products sold by a refinery and the cost of raw materials (crude oil) and other feedstocks, typically calculated per barrel. It is a key indicator of operational efficiency and profitability, but does not represent net profit, as it excludes operating costs, maintenance, and taxes.