The rating on Thai Oil Public Co. Ltd. (Thaioil) reflects the support the company receives from its operational integration with, and strategic importance to, state-owned oil and gas conglomerate PTT Public Co. Ltd. (BBB+/Stable/--). The rating also reflects Thaioil's favorable cost structure, flexibility in feedstock selection, and strong domestic market position. Inherent industry risks, the recovering outlook for the refinery and aromatics industries, and the company's single-site and customer concentration risks partly offset these strengths. Thaioil's refinery and lube margins improved in 2010 due to a recovering global economy. The improvement reduced the affect of weak spreads in the aromatics segment in the first half of 2010. Aromatics' spreads recovered in the second half of 2010 and Thaioil's gross integrated
