Logo of Phnom Penh Post newspaper Phnom Penh Post - Fuel prices steadily increase

Fuel prices steadily increase

A man refills his motorcycle at a petrol station in Phnom Penh’s Tuol Kork district yesterday.
A man refills his motorcycle at a petrol station in Phnom Penh’s Tuol Kork district yesterday. Hong Menea

Fuel prices steadily increase

Nearly four months after the Ministry of Commerce implemented a fuel-pricing mechanism that lowered prices at the pump to reflect the fall in the global commodity last March, petrol prices have inched back up to pre-intervention levels.

Prices in early June are now back up to the same level before the government stepped in and intervened after a drawn-out two-month negotiation process brought the Kingdom’s oil importers to the table.

As consumers continue to criticise the regular 10-day hikes of fuel prices, the government has stood by the pricing mechanism, saying that it adequately represents global oil fluctuations.

According to the announcement from Ministry of Commerce, prices at the pump until June 11 are set at a maximum of 3,550 riel per litre for premium while regular petrol is fixed at 3,450 riel. Diesel costs 3,100 riel per litre.

Pen Sovicheat, director of domestic trade at the Ministry of Commerce, explained that the formula to determine price is based on the average Means of Platts Singapore (MOPS) benchmark, which also is adjusted for local customs fees, operating costs and value-added tax (VAT). He said the incremental rise in fuel prices over the last four months showed that the mechanism was achieving the desired results.

“Nothing has changed [for the mechanism] and prices have increased according to the international market,” he said, adding that as the price rises in Singapore, Cambodian prices would fluctuate. “The formula is transparent.”

Until this month, the fuel mechanism had consistently raised prices every 10 days at a rate of $0.3374 for premium while regular and diesel were capped at $0.3174 and $0.2927, respectively. However the June data for MOPS showed per litre increases of $0.3850 for premium, $0.3665 for regular and $0.3601 for diesel.

As prices are now back to pre-intervention levels, consumers have taken to social media to criticise and question the government’s pricing mechanism.

Tuk-tuk driver Sun Ra raised concerns about the increases as he regularly consumes nearly 4 litres of petrol per day.

“I appeal to the government to prevent more increases,” he said. “It is good to keep it below 3,000 riel per litre.”

Teng Delux, a lecturer of economics at a university Phnom Penh, said the government’s price mechanism was balanced and had helped to keep fuel prices reasonable. He added that when fuel was around 3,000 riel per litre, global crude prices hovered around $32 per barrel. Now, crude oil was nearly $50 per barrel.

“Without intervention, I think consumers would be paying higher than what they are now,” he said.

Cambodia imports between 1.5 million and 2 million tonnes of petrol and diesel annually. It is estimated that up to 5 to 7 million litres of fuel products are consumed daily.

MOST VIEWED

  • South Korea’s first lady brings hope to ill boy

    South Korea’s first lady Kim Keon-hee – wife of current president of the Republic of Korea, Yoon Suk Yeol – met with a 14-year-boy with congenital heart disease during her trip to the Kingdom for the ASEAN Summit. After their meeting it was announced that the

  • Hun Sen gets Covid, shuns G20, APEC summits

    Prime Minister Hun Sen said he has tested positive for Covid-19 in Indonesia, where he is slated to attend the G20 summit in his capacity of the ASEAN chair. In a social media post addressing the Cambodian public, he said: “Before leaving Cambodia, I always

  • Moody’s sets outlook rating to ‘negative’ for Cambodia

    US global rating agency Moody’s Investors Service Inc on November 15 announced that it downgraded Cambodia’s outlook from “stable” to “negative” and maintained its B2 local and foreign currency issuer ratings. “The negative outlook reflects a deteriorating external position as illustrated by the severe

  • Hun Sen’s Covid infection caused by ‘weakened antibody’ after summit

    Prime Minister Hun Sen said exhaustion from heavy workload before and during the recent ASEAN Summit may have led to him contracting Covid-19 due to his weakened immune system, while rejecting speculations that the infection was caused by leaders of some countries who did not

  • Korean first lady paves way for ill boy’s surgery

    A 14-year-old boy with congenital heart disease who was lucky enough to meet with South Korean first lady Kim Keon-hee may get the chance of a lifetime and receive surgery and treatment at Asan Medical Center in Seoul, South Korea. After seeing his plight, many

  • Kingdom’s rice crowned world’s No1

    Cambodia’s Phka Rumduol jasmine variety has been crowned the World’s Best Rice for the fifth time at the TRT (The Rice Trader) World Rice Conference in Phuket, Thailand on November 17, according to leaders of the Kingdom’s apex rice industry body. Phka Rumduol