Cambodia spent $971.30 million on imports of petrol and diesel in the first five months of this year, up by 57.36 per cent from the $617.24 million shipped in during the corresponding period in 2021, according to the commerce ministry.
Petrol imports were $341.94 million, up by 103.11 per cent year-on-year from $168.35 million, while diesel accounted for $629.36 million, rising by 40.20 per cent from $448.89 million.
International oil prices have soared by more than 40 per cent from the beginning of the year. As Cambodia no longer produces crude oil and relies solely on imports, fuel rates must rise in line with international market trends, Ministry of Commerce spokesman Penn Sovicheat explained to The Post on June 30.
He predicted that fuel prices would continue their upward spiral, underpinned by the Russia-Ukraine conflict, as global oil supplies fall, in part due to economic sanctions imposed on Moscow as a result of the Kremlin’s military offensive against its neighbouring country.
Although unable to provide concrete figures, Sovicheat claimed that the volume of petrol and diesel imported in January-May increased year-on-year, as production gradually picked up amid declining Covid-19 rates, but “not by much”. He clarified that the import figures were inflated due to the elevated prices of the fuels.
He said that the commerce ministry monitors trends in the global oil market and determines domestic prices for fuel, as an essential daily commodity, that are bearable by ordinary Cambodians.
Oil tankers are arriving to Cambodia, usually every three or four days, with increasingly expensive payloads, Sovicheat explained, noting that the Kingdom imports the fuels from Singapore, Thailand and Vietnam.
The spokesman underscored that Cambodia has yet to face a major shortage of fuel for retail customers, despite the increased costs, and that the ministry works with importers to ensure at least 20 days worth of petrol and diesel supplies.
Hong Vanak, director of International Economics at the Royal Academy of Cambodia, blamed the rising international oil prices on a supply-demand imbalance in the global market, noting that fuel demand will continue to grow as countries dial back Covid-19 restrictions, leading to a recovery in production and international travel.
“Looking at the current situation, the price of fuel will continue to rise and the value of Cambodian imports will increase accordingly,” he lamented.
With the overwhelming reliance on petrol and diesel across production chains – from cultivation, processing, packaging and transportation – a sustained uptrend in oil prices will pose significant economic challenges for the peoples and governments of oil importing countries like Cambodia, Vanak added.
As of June 30, the retail prices of petrol and diesel in Cambodia stand at 5,800 riel ($1.45) and 6,300 riel, respectively, up by 41 per cent and 68 per cent from their December 31 rates of 4,100 riel and 3,750 riel, commerce ministry notices indicate.