Commerce Ministry moves to curb price shocks from oil surge

The war in the Middle East has intensified, and the closure of the Strait of Hormuz, a key strategic route for global oil shipments, has caused world oil prices to surge rapidly. This has raised concerns over energy shortages and wider repercussions for the global economy.

For Thailand, although its trade value with the countries involved in the conflict in the Middle East is not particularly high, the indirect impact of soaring oil prices remains a major risk factor. 

In 2025, Thailand’s exports to the region were valued at US$12.48 billion, accounting for 3.67% of total exports. However, rising oil prices are expected to push up production and transport costs, with the likelihood that these increases will eventually be passed on to consumer goods prices if the situation persists.

The government has therefore urgently convened meetings of the economic team and relevant agencies to prepare response measures, particularly to maintain stability in domestic goods prices.

The Commerce Ministry, which is responsible for overseeing product prices, has been instructed by Commerce Minister Suphajee Suthumpun to ensure that all agencies closely monitor the situation, assess the impact on a day-to-day basis, and prevent businesses from taking advantage of the situation by raising prices beyond what is necessary, so as to avoid adding to the cost of living for the public.

At the outset, six key measures have been put in place to strictly control and monitor product prices:

• Managing goods prices and preventing profiteering
• Securing reserve sources of raw materials and production inputs
• Supporting exporters and managing logistics
• Coordinating with shipping and logistics service providers
• Using the proactive role of Thai commercial diplomats abroad
• Continuously analysing the impact on inflation and price stability

Meanwhile, the Trade Policy and Strategy Office (TPSO) has assessed the impact under three scenarios:

• Scenario 1: If crude oil reaches US$80 per barrel, inflation is expected to remain at 1–2%, while ready-to-eat food prices may rise by around 10% in 10% of areas nationwide.
   
• Scenario 2: If crude oil rises to US$100 per barrel, inflation could increase to 2–3%, while ready-to-eat food prices may rise by 10% in 20% of areas.
   
• Scenario 3: If crude oil exceeds US$120 per barrel, inflation could go beyond 3%, while ready-to-eat food prices may rise by 10% in as much as 50% of areas across the country.

A key risk lies in the price of Dubai crude, which serves as the benchmark for calculating Thailand’s energy costs. The energy category accounts for around 12% of the inflation basket, while transport and communication carry a weight of as much as 22.25%. If oil prices continue to climb, the higher costs will feed through to fares, freight charges and product prices.

Particular concern surrounds ready-to-eat meals and single-dish meals, a category known for being “quick to rise, slow to fall”. This group accounts for around 16% of the inflation basket and tends to increase rapidly in line with energy costs, but declines only slowly when costs ease.

The Department of Internal Trade has already stepped up coordination with a number of consumer goods manufacturers, many of whom have not yet been affected by rising costs.

It has also instructed both central officials and provincial commerce offices nationwide to conduct close inspections of goods sales, particularly for products linked to energy and transport costs, to prevent unjustified price hikes.

Businesses have also been reminded to display prices clearly, correctly and completely in line with the law. Provincial commerce offices nationwide have been tasked with supervising consumer goods prices and preventing opportunistic and unreasonable price increases.

The main objective is to maintain price stability for domestic goods, reduce the impact on the public’s cost of living, and preserve economic confidence amid volatility in the global energy market.

From here, oil prices will need to be watched closely. If they continue to rise, production costs will inevitably be affected. In turn, product price increases may become unavoidable, with consumers bearing the brunt of the impact.