Thai Oil Public Company Limited (TOP) continues to strengthen its operations amid global volatility by prioritizing risk management, crude oil procurement and stable production capacity to support Thailand’s energy security and domestic demand.
Mr.Pongpun Amornvivat, Chief Executive Officer and President of Thai Oil Public Company Limited, said conflicts between the US and Iran and the temporary closure of the Strait of Hormuz have heightened risks to global energy supplies, impacting around 20% of global crude oil shipments.
“Thaioil has implemented an immediate strategy to diversify its crude oil procurement, reducing reliance on Middle Eastern supplies while seeking alternative sources,” he said.
In the second quarter of 2026, Thaioil secured crude oil from a diversified range of sources, including the Middle East 59%, Africa and Americas 32%, Thailand 7% and the Far East 2%.
The company has also maintained sufficient crude oil reserves to support continuous refinery operations at high utilization rates, helping ensure a stable supply of petroleum products and strengthen Thailand’s energy security.
Proactive management to navigate market challenges and strengthen Thailand’s energy security
The conflicts contributed to a sharp increase in crude oil prices from March to May 2026, before prices fell significantly in June following a temporary ceasefire agreement between the US and Iran. As shipping through the Strait of Hormuz resumed, the restoration of Middle Eastern crude supplies to global markets contributed to the decline in crude oil prices towards the end of the second quarter.
However, Thaioil typically procures crude oil one to two months in advance. As a result, the crude oil processed during the second quarter was purchased in April and May, when prices remained elevated. This led to a stock loss amounting to THB 10,741 million, equivalent to US$ 12.2 per barrel. Oil price risk management also contributed to a loss of THB 6,476 million. Consequently, Thaioil reported EBITDA of THB 8,915 million in the second quarter. After depreciation, finance cost and income tax expense deduction, the company recorded a net profit of THB 8,284 million, equivalent to THB 3.71 per share, down THB 11,197 million from the first quarter of 2026.
Thaioil refinery risks under market volatility in the second half of 2026
Key risk factors to be closely monitored are as follows:
1. Potential stock losses in the second half of 2026
Crude oil procured in advance when prices were elevated is expected to be recognized at lower values if geopolitical tensions ease and crude oil prices decline further. The resulting stock losses could weigh on Thaioil’s operating performance during the second half of 2026.
2. Liquidity and cash flow pressures from cooperation with the government to ease living costs
The reduction in Diesel ex-refinery prices, in accordance with the Energy Policy and Planning Office’s measures, by THB 1.40–2.40 per litre from 9th July to 15th August 2026, together with outstanding receivables from the Oil Fuel Fund, is expected to reduce the company’s liquidity by approximately THB 10,800 million and increase its annual financing cost by around THB 320 million. These reflect the company’s crucial role in ensuring the country’s energy security, even as it faces reduced liquidity and increased financial burdens.
3. Volatility in domestic demand for refined petroleum products
Domestic demand for refined petroleum products is expected to weaken, potentially increasing refineries’ s stockpiles and storage costs. Demand volatility could affect the production and distribution of refined petroleum products and other key products and raw materials, including Liquefied petroleum gas (LPG), Naphtha, Sulphur and certain petrochemical products. This could have wider implications for supply chains across related industries.
Driving operational efficiency to support future growth
1. Implement proactive strategies to strengthen domestic energy security
Thaioil has diversified its crude oil procurement sources, including supplies from Africa and Americas, while deploying floating storage facilities and securing additional fuel storage tanks to maintain stable refinery operations and ensure sufficient supplies for domestic demand.
2. Continue the Clean Fuel Project (CFP) as planned
Thaioil has progresed with the Clean Fuel Project as scheduled, with commissioning of the new crude distillation unit expected in 2027 and commercial operations targeted for the third quarter of 2028. The project supported domestic employment, creating more than 20,000 jobs during the construction phase in Q2/ 2026
Thaioil contributes more than THB 3,500 million to easing living costs and improving quality of life
For more than 65 years, Thaioil has maintained strong business operations while creating value for communities and society across Thailand. In 2026, the company is stepping up efforts to help ease the cost of living and improve the quality of life of Thai people, with total contributions exceeding THB 3,500 million. The company’s support for government’s measures to ease the public’s financial burden includes reductions in Diesel ex-refinery prices during the first half of 2026, with the contribution amounting to THB 3,220 million. In addition, Thaioil’s social development programmes in 2026 total THB 300 million, cover public health and wellbeing, energy and environment, education, society and culture.
Public health and wellbeing: Thaioil has provided more than THB 170 million to support Laem Chabang Hospital, including funding for the construction of the five-story Thaioil Building, which houses accident and emergency services, as well as solar panel installations and basic infrastructure. In 2026, the company also has donated medical equipment worth THB 195 million to 16 hospitals nationwide to strengthen healthcare services.
Energy and environment: Thaioil has supported the installation of solar panels for 24 public hospitals and educational institutions, helping reduce greenhouse gas emissions equivalent to the carbon absorption of approximately 45,000 trees*. The initiative also helps reduce energy costs and improve the quality of life in local communities.
Education, society and culture: Thaioil continues to support youth development through scholarships, educational and skills-development programmes, alongside initiatives promoting sports and the conservation of arts, culture and local traditions. These programmes aim to expand opportunities for young people and strengthen the long-term resilience of communities.
Amid heightened volatility in global energy markets, Thaioil remains committed to strengthening Thailand’s energy security by securing diverse crude oil supplies and maintaining reliable refining capacity. At the same time, the company continues to develop The Clean Fuel Project (CFP) to enhance
Thailand’s competitiveness. These efforts reflect Thaioil’s commitment to balancing economic growth with social and environmental value while creating sustainable benefits for its stakeholders under its ESG framework.
