With the US/Israel war with Iran, fuel prices around the world have increased, including in Laos. Recent events in February and March this year, coupled with Iran's response to the war by a partial closure of the Straight of Hormuz, saw frenzied fuel buying throughout Laos when news broke that Thailand said it would ban fuel exports that was to become effective March 1.
However, in a subsequent statement on March 6 by Thailand's Prime Minister Anutin Charnvirakul, clarified that exports to Laos and Myanmar would continue.
Even with that update, long line-ups at gas stations persist especially in Vientiane and Luangprabang (including at the time of this writing).
Lao government response
On March 6, the Lao government announced that it would review fuel prices every 2-3 days rather than weekly. This would allow it to adapt more quickly to prices on the global market.
On March 13, the government announced that it would begin conducting nation-wide inspections of gas stations. Inspectors were charged with the task of checking what gas stations are charging customers to confirm retail prices and to investigate the reason for the closures. This included reviewing their fuel management, supply contracts, deliveries, and sales.
Further, Laos' cut import taxes on special gasoline 95 from 20% to 15% and allocated billions of Lao kip (approximately LAK300B-600B) to a special fuel supply fund to help the country better manage its national fuel supply.
On March 19, the government changed school days down to 3 days a week. The following day on March 20, it reversed that decision and instead advised students to use alternative forms of transportation such as bicycling. However, college and university students will go to a 3 days schedule starting April 2026. Teachers are being advised to consider hybrid learning models such as online classes.
Developing resilience
Recent events has brought back the topic of Laos' fuel energy security and the importance of building up its resiliency against such shocks. Its ability to withstand fluctuations to its fuel supply still requires significant policy and infrastructure improvements.
Supply Sources
According to the Lao Department of Foreign Trade statistics for 2025, 97.1% of the country's fuel was imported from Thailand - worth USD$1.22B out of USD$1.26B in fuel imports. While the remaining smaller percentages come from Vietnam, Singapore, South Korea, Japan, USA, and a few others. The heavy reliance on any one country, continues to present a strategic risk. Continuing to diversify its supply would be key.
With Laos' dependence on Thai oil, a look into Thailand's own crude oil and other petroleum imports indicate that for 2024 more than half of all its imports came from the Middle East, with a large majority of that from the United Arab Emirates, according to the Thai Ministry of Energy. This means that Thailand itself is also in a sensitive situation as supply from that part of the world slows down.
Laos' own refinery
In addressing the issue of energy resilience, Laos did open its own refinery for the first time back in 2020 called Laopec (aka Lao Petroleum and Chemical Co. Ltd.). It became the country's first such facility. It was able to do this through a joint venture with the Lao State Fuel Co. and 2 Chinese investment firms, namely Yunnan Dongying and Lao-China Joint Venture Investment Co. Ltd.
Its ultimate goal was for Laos to reduce its reliance on foreign fuel sources, be able to refine oil, and be able to at least supply its own domestic demand for gasoline and diesel.
The refinery is located in Vientiane city, in the Saysettha Comprehensive Development Zone. Its initial construction cost estimates was USD$2B over 3 construction phases and multiple years with an expected completion date of 2023. Its capacity after each phase of completion would add 1M tonnes per year and up to 3M tonnes per year by the end of phase 3. As well, 16 storage tanks with a total capacity of 80M tonnes.
However, the final status of the facility and its capacity remains to be confirmed in 2026 as there haven't been any recently published updates on the state of Laopec.
One official update from a Vientiane Times article dated from 2022 indicated that at that point the facility was only at 10% capacity and had encountered delays. Notably, at that point they already had 300 employees, half were Lao and the other half were Chinese nationals.
Mandatory oil stockpiles
According to the International Energy Agency (2022), the Lao PDR has a mandatory oil stockpile of 21 days for companies importing oil and 10 days for distributors. This means that these entities need to have enough to withstand no replenishment for those number of days before they run out of stock.
However, recent events have shown that gas station closures happened within only days of frenzied buying from consumers.
Remains to be seen
As the events in the Middle East continue to unfold and until the issue of security for ships passing through the Strait of Hormuz is resolved, fuel prices are expected to remain high for the near future for many countries.
Resource to help
Meanwhile, those looking for gas stations (including their status and fuel availability) in Laos can refer to this online resource: https://gas.mts.la. This website that was created by a local Lao company named MTS back in 2022. Understandably, it has seen a huge surge in use this month.
- Laoconnection.com
(Last updated March 23, 2026)
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