Thailand’s economic growth could come under increasing pressure as rising global oil prices, driven by escalating tensions in the Middle East, weigh on the outlook, according to caretaker Finance Minister Ekniti Nitithanprapas.
Following an urgent meeting of Finance Ministry executives, Mr Ekniti said that the National Economic and Social Development Council (NESDC) had conducted a detailed assessment of the conflict’s potential economic impact. The agency now expects the situation to persist beyond one month, exceeding earlier projections.
He noted that initial estimates suggested every US$10 increase in global oil prices would shave around 0.2 percentage points off Thailand’s GDP growth, based on a scenario in which the conflict is resolved within a month.
However, with signs pointing to a prolonged conflict, oil prices are likely to rise further than previously anticipated. This would increase energy costs and place additional strain on the broader economy.
The Finance Ministry has convened internal discussions to closely monitor developments in the oil market, including supply and import factors. Further details and policy responses are expected to be announced by the ministry’s permanent secretary or official spokesperson.
Earlier, NESDC secretary-general Danucha Pichayanan outlined two possible scenarios. In the first, where the conflict ends within one month but the Strait of Hormuz is temporarily closed, oil prices could rise to US$95–105 per barrel, reducing Thailand’s GDP growth to 1.6% from an initial forecast of 2%.
In the second, more severe scenario, where the conflict extends beyond one month and the strait remains closed, global supply disruptions could push oil prices to US$115–125 per barrel. Under these conditions, Thailand’s economic growth could slow further to 1.3% this year.