As Cambodia’s gasoline prices hit record high following Russia’s invasion of Ukraine, some stations in Phnom Penh have announced they are out of stock of regular gas.
The high prices have hit especially hard for lower income Cambodians who already face financial crises due to the pandemic.
The current retail price is set at 5,300 riels ($1.32) a liter for regular gasoline and diesel compared to 4700 riel a month ago. The retail price of premium oil stands at 5,850 riels ($1.46) a liter. The price will be revised after March 31.
Lach Ponlork, a tuk-tuk driver in Phnom Penh said that the high price of gasoline is destroying his daily income.
“It really affects my family’s livelihood as the income declines and there is almost not enough for expenses,” he said.
Ponlork earned an average of 80,000 riel per day during the past two months, but the price of gas has dropped his daily income down to about 50,000 riel.
“I want the government to provide some incentives to help the most vulnerable people,” he said. I cannot earn enough money while I need to pay the loan.”
Another tuk-tuk driver, Eam Sarin, 52, said he earns about 50,000 riel a day and spends at least 20,000 of that each day for LPG. This has added difficulty as his ridership had dropped nearly 80 percent from pre-pandemic levels.
Sarin, who is registered with the local ride-hailing service Passapp, urged the company to reduce the fees charged to driver to ease the burden during the energy price crisis.
“I just request that the company reduce the service fee from 15 percent to 10 percent,” he said. “Right now, we earn money just for gas.”
Speaking at a gas station as he fueled his motorbike, Phnom Penh resident Kong Sotra David said he understood this was a global issue — not unique to Cambodia — but noted that the price rise has been challenging.
“My workplace is far, so I have to pay more for petrol,” he said. “[I’m] concerned that some gas stations are running out of stock, which would lead to higher prices.”
With the continued rise in gasoline prices, Cambodian’s Ministry of Commerce announced it would begin revising the updated price guidelines every 10 days, rather than every 15 days.
According to the MOC’s announcement on March 16, the government is already subsidizing the current price by 4 cents per liter.
Prime Minister Hun Sen said in a speech in Prey Veng province on Thursday that the rising gas prices are due to global circumstances and that the only solution is to travel less.
“Do not curse Hun Sen for the gasoline price, because this is an international situation, the war between Russia and Ukraine has created a problem for the global economy and oil prices,” he said.
Ministry of Commerce undersecretary of state, Pen Sovicheat, said that the jump in international prices has led to the retail price in Cambodia increasing. But he noted that stations shouldn’t be running out of gasoline, saying that the Inter-Ministerial Prakas clearly states that all gas stations must offer different options.
“All stations are required to not only sell premium gasoline, so there must be premium, regular and diesel,” he said. “We would inspect the stations that claim to be out of stock, and if we find they are intentionally refusing to sell regular gasoline to customers based on any reason, the Ministry will take action against them with a monetary fine.”
According to Sovicheat, all oil importers are required to have reserved stock for at least one month.
Vorn Pao, President of the Independent Democracy of Informal Economy Association (IDEA), said he believed more could be done to lower import tariffs to reduce the domestic price.
“The government needs to increase the tariff on alcohol and unnecessary products, and I think that the state can use this mechanism to address the issue,” he said.
Pao said when the price of gasoline skyrockets, it affects lower income Cambodians the most, especially the informal workers.
“ Covid-19 remains a concern and the high price of gasoline is making the situation worse because gasoline and gas are a key commodity and if the price increases, it also pushes other goods higher,” he said.
All of Cambodia’s oil is imported. An effort to produce offshore oil last year halted after just a few months after the Singapore-based oil and gas firm KrisEnergy went bankrupt.
Rising gasoline prices have hurt the transportation sector as a whole.
Sin Chanthy, president of the Cambodia Logistics Association, said that after being hit by the COVID-19, the high of gasoline is burdening the logistics sector.
“The price of energy is important for logistics, and this is affecting the sector,” he said. “We are currently discussing finding ways to reduce the impact cost as some companies ask for increasing the price of transportation fee.”