Global oil prices remain high amid ongoing geopolitical tensions and the risk of a closure of the Strait of Hormuz, a critical global energy shipping route, which is becoming a significant pressure point that may accelerate inflation again.
In Thailand, the recent pump price increase reflects these pressures. Although the short-term impact remains limited, analysts see this as the start of a new inflation cycle, which could mean that interest rates will only 'hold' or 'rise' from now on.
Meanwhile, global investors are focused on tonight’s U.S. Federal Reserve meeting, expected to maintain interest rates despite possible signs of U.S. economic slowdown, as rising crude oil prices may also impact inflation.
The international market analysis team at PTT Public Company Limited assessed the oil market situation for the week of 16–20 March 2026 and the outlook for the following week, noting that global oil prices are still supported by geopolitical tensions, especially conflicts between the U.S. and Iran.
Regarding the potential closure of the Strait of Hormuz, a major global oil shipping route, the market continues to monitor this risk. The International Energy Agency (IEA) plans to release a total of 400 million barrels from strategic petroleum reserves to ease supply tightness.
Overall, this indicates that oil prices are likely to remain high and are beginning to exert inflationary pressure in several countries, including Thailand.
However, yesterday the government announced pump price adjustments: gasoline and Gasohol 95 increased by 1 baht per liter, diesel rose by 50 satang, while E20 was reduced by 79 satang, effective from 05:00 on 18 March 2026.
This movement is seen as an early upstream ripple effect that may feed through to inflation going forward. Though short-term impacts remain limited, if energy prices continue to rise, it could mark a turning point for Thailand’s monetary policy.
Analysts at PTT Securities view the recent domestic oil price increase as a mild accelerator of inflation, moving gradually. They believe the lowest point for Thai interest rates has passed, and from now on rates will likely stabilize or rise if inflation intensifies.
Nonetheless, the short-term investment atmosphere remains in a 'wait and see' mode, with investors awaiting the U.S. Federal Reserve meeting tonight. The meeting is expected to hold rates steady due to geopolitical issues pushing crude oil prices up, which may influence U.S. inflation despite some signs of economic slowdown.
Data from CME FedWatch indicates a roughly 99% probability that the U.S. Federal Reserve will maintain interest rates and suggests rate cuts may not occur until December 2026.
Strategically, short-term investors might gradually take profits to reduce volatility risk while markets await clearer directions for future monetary policy.
Clearly, with Thai interest rates likely having passed their lowest point and possibly entering an upward cycle if inflation accelerates, the sector directly benefiting is "commercial banks," which earn primarily from interest rate spreads.
PTT Securities recommends two standout stocks:
KBANK is recommended as a “buy” with a target price of 210 baht. Valuation is attractive based on the GGM method (ROE 8%, Terminal Growth 2%) at 0.8 times 2026 PBV. The bank is expected to focus on capital management via high dividend payouts and ongoing share buyback programs.
KTB is also recommended as a “buy” with a target price of 35 baht, valued using GGM (ROE 10%, Terminal Growth 2%) at 1.0 times 2026 PBV. It stands out for its long-term profitability potential and aims to maintain double-digit ROE.
Read more on stocks and investments at Thairath Money.
Follow the Facebook page: Thairath Money at this link.