Road users can expect to pay up to 500 riel ($0.12) more per liter of fuel due to the increase in global crude oil prices after the government last March pegged local prices to that of the international market, a Commerce Ministry official said yesterday.
From today until January 21, drivers can expect to pay 3,850 riel ($0.95) per liter for Gasoline 95, up 500 riel ($0.12), 3,750 riel ($0.93) per liter for Gasoline 92, up 450 riel ($0.11), and 3,450 riel ($0.85) per liter for diesel, up 450 riel ($0.11).
“Please understand that the mechanism is just to prevent gas prices from increasing higher than that of the global gas price or when global gas prices go down, all local retail gas stations in Cambodia are also compelled to bring down the prices,” Commerce Ministry spokesperson Soeng Sophary said.
“This formula is not intended to keep gas prices in Cambodia low even when global gas prices are on the rise.
“We just want to prevent retailers from increasing their prices beyond that of global prices. We will follow the global market price,” she explained.
Gas prices have been steadily increasing since November last year.
The government last March announced that it would be standardizing retail gas prices in Cambodia by pegging them to world oil prices in the wake of the plunging global crude oil price the year before.
The Commerce Ministry was tasked with releasing updated prices to all retail stations every 10 days, on the first, 11th and 21st of each month.
Ms. Sophary attempted to quell dissatisfaction over the increase in prices by explaining that the new mechanism of calculating prices made Cambodia susceptible to world oil prices, which fluctuate according to global markets.
“We are easily affected if there is any issues going on within those larger economies,” she said. “We cannot ask to lower gas prices when the global economic system is always changing since we have to follow the global situation.
“The price could go down after US President-elect Donald Trump takes office later this month or it could increase if there are any issues in the EU or if there is ongoing terrorism in Turkey,” she said, adding that Cambodia would only be able to experience consistently low gas prices if it could produce its own refined product.
PTT (Cambodia) deputy managing director Bin Many Mialia told yesterday that he understood the price hike given the new pricing mechanism, but remained optimistic as given the uncertainty of the global political climate, world oil prices could see a reduction next month.
“The price for gas in Cambodia goes up and down since we are solely, 100 percent dependent on international gas prices. We cannot adjust the price, increase it or lower it, we cannot predict what the gas price will be. It’s up to the international market price,” Mr. Many Mialia said.
“Now we see the trend of the oil price being high, but we will wait and see next month whether it continues to increase or if it will fall. All the countries don’t know what the US policy will be like or what the regional situation will be,” he added.
According to a report from the Cambodia Import-Export Inspection and Fraud Repression Directorate-General, oil imports to Cambodia increased by one percent in the first 11 months of 2016, while the value of oil imported dropped by about 28 percent.
The report showed that from January to November 2016, Cambodia imported 1.5 million tons of oil, compared with 1.49 million during the same period in 2015.
Gas prices decreased by 16 percent, while diesel and petroleum prices dropped 19 percent and 28 percent respectively.
The value of the oil imported throughout those 11 months last year stood at $615 million compared with $858 million the year before.