Thailand’s equity market is expected to come under pressure as surging diesel prices raise concerns over economic growth and corporate earnings, although easing geopolitical tensions may help cushion downside risks, analysts say.

Tourism operators have expressed mixed views on the new government’s plan to levy a 300‑baht tourism tax, as it may affect travel sentiment amid sluggish tourism caused by the Middle East crisis.

Energy Minister Akanat Promphan, in his capacity as chairman of the Energy Policy Administration Committee (Epac), has ordered a reduction in diesel refining margins aimed at lowering retail fuel prices by about 2.14 baht per litre, with the measure expected to take effect on Thursday.

Bangkok Aviation Fuel Services Plc (BAFS), Thailand’s sole jet refuelling provider, has called on the government to exempt jet fuel from the excise tax of 4.72 baht per litre, warning the levy undermines the country’s aviation competitiveness.

The construction and property sectors are being forced to adjust strategies and build greater resilience to cope with volatile energy prices, as the Middle East conflict drives up both energy and construction material costs, according to Siam Commercial Bank Economic Intelligence Center (EIC).

Thailand faces a heightened risk of stagflation as elevated oil prices nudge up inflation, with the new government unlikely to launch large stimulus measures to prop up the subdued economy given high public debt levels, warn analysts.