On Thursday, Thai oil refinery stocks are coming under pressure as investors assess the potential impact of the government’s latest fuel price restructuring on operators’ revenue and profitability.
The share price of PTT Global Chemical Public Company Limited (SET: PTTGC) at the time of 11:28 a.m. was at THB 47.50, a THB 3.50 or 6.86% decrease with a total trading value of THB 2,622 million.
The share price of Thai Oil Public Company Limited (SET: TOP) was at THB 61.75, a THB 3.50 or 5.36% decrease with a total trading value of THB 1,713 million.
The share price of Bangchak Corporation Public Company Limited (SET: BCP) was at THB 47, a THB 2.50 or 5.05% decrease with a total trading value of THB 700.62 million.
The share price of IRPC Public Company Limited (SET: IRPC) was at THB 2.70, a THB 0.10 or 3.57% decrease with a total trading value of THB 219.31 million.
The share price of Star Petroleum Refining Public Company Limited (SET: SPRC) was at THB 13.90, a THB 0.30 or 2.11% decrease with a total trading value of THB 343.56 million.
Energy Minister Akanat Promphan announced an update to the ex-refinery fuel price calculation formula, effective October 29, 2026. The revision removes certain hypothetical cost items, often referred to as “phantom costs,” from the pricing formula that has been in place since 2004.
According to the Ministry of Energy, the removed items include non-actual expenses related to freight, insurance, and transit loss costs for oil shipments from Singapore to Thailand. The ministry has also adjusted fuel reserve costs to better reflect actual incurred expenses. The Ministry expects the restructuring to reduce Thailand’s energy cost burden by approximately THB 10.84 billion per year.
However, the measure is seen as an increased policy risk for refinery operators, as changes to the ex-refinery price calculation could affect refined product price spreads and overall profitability. Investors are expected to monitor the actual impact on individual listed refinery companies, particularly as global refining margins are beginning to show signs of slowing.
Kasikorn Securities (KS) has taken a negative view on trading sentiment for Thailand’s refinery sector following reports that the National Energy Policy Council (NEPC) has resolved to remove additional hidden cost components from domestic ex-refinery oil pricing.
KS noted that the restructuring would effectively shift the ex-refinery pricing formula from an import parity basis to a price equivalent to the Singapore market. Under the new formula, domestic ex-refinery prices could decline by around $1-2 per barrel.
However, the brokerage emphasized that actual ex-refinery transactions still depend on domestic supply and demand conditions. The formula price is only a government reference price, meaning the key factor will be how authorities enforce or implement the new pricing mechanism.
If the new formula is fully enforced, KS estimated the earnings impact on refinery stocks, including TOP, BCP, SPRC, PTTGC and IRPC, could be around 8-17%. The estimate is based on KS’s 2027 gross refining margin assumption of approximately $9.7 per barrel.
KS also warned that strict enforcement could make it more difficult for Thailand to import refined oil products to cover shortages during refinery maintenance periods, as importers such as PTT Trading may face losses.
On the other hand, if the government does not introduce clear enforcement measures, refiners may continue selling refined products based on actual price negotiations. This could distort retail fuel pricing at service stations and ultimately affect the marketing margins of oil retailers such as OR and PTG.
KS said it is awaiting further details on how the revised ex-refinery pricing formula will be enforced. The brokerage believes the impact on refiners would be most visible during periods of export control, but the actual impact should be lower than the theoretical estimate, as domestic sales normally involve multiple pricing tiers and some export activity remains.
As a result, KS recommends investors “Buy” refinery stocks when share prices weaken in response to the anticipated impact. Its preferred picks are PTTGC, citing its relatively larger share price decline compared with other refiners, business diversification into petrochemicals and a short-term joint venture deal with SCC, and PTT, due to its integrated upstream-to-downstream business structure, strong balance sheet and potential support from a special dividend
