PATTAYA, Thailand – Thai Oil reported a massive first-quarter profit of 19.48 billion baht for 2026, driven largely by soaring oil stock gains during the height of Middle East supply fears. However, the company is now warning that falling oil prices and weakening refining margins could trigger significant losses in the coming quarters.
Thai Oil revealed that nearly 85% of its Q1 profit came from inventory gains linked to higher crude oil prices, while core refining operations generated a far smaller operational profit. Executives warned that those temporary gains may reverse sharply if oil prices continue declining as geopolitical tensions ease.
The company said it maintained refinery operations above normal capacity — running at 113% or around 300,000 barrels per day — to help secure Thailand’s energy supply during the peak of the Middle East crisis and disruption fears surrounding the Strait of Hormuz.
But with Thailand still restricting fuel exports, refined oil inventories have surged, forcing the company to use storage tanks from its Clean Fuel Project to store excess jet fuel. Thai Oil warned it may eventually need to reduce refining output if inventories continue rising.
Executives also expressed concern over rapidly deteriorating refining margins. Gross refining margins are expected to fall sharply from 7.6 baht per liter in Q1 to around 2.6 baht in Q2, before potentially turning negative at minus 2.3 baht per liter in Q3.
Thai Oil additionally warned of growing liquidity pressure after spending heavily on advance crude purchases during the height of oil price volatility. The company estimates that increased working capital needs, government diesel price controls, and delayed compensation payments have reduced liquidity by roughly 31 billion baht.
The refinery giant is now urging authorities to ease restrictions on jet fuel and diesel exports to help reduce swelling domestic fuel inventories, while also calling for an end to refinery price suppression measures introduced earlier this year.
