Price increase was a result of of the retail petrol sector operating as a cartel: SRP MP Yim Sovann

World oil price increase felt at Cambodia's petrol pumps

Wednesday, 13 May 2009
Written by Kay Kimsong
The Phnom Penh Post

Increase in world oil price well above $50 a barrel impacts on Cambodian fuel – all of which has to be imported – with further price rises expected

PETROL prices in Phnom Penh have jumped by up to 200 riels (4.8 US cents) per litre in the past week, with petrol companies and analysts saying motorists should expect further increases as global petrol prices continue to have a knock-on effect at the petrol pump.

Since February, international prices for crude oil jumped from a year low of US$45 to $58 per barrel - a rise of nearly 30 percent.

With Cambodia still importing 100 percent of its oil products, the country remains susceptible to global market fluctuations, according to oil analyst Bin May Mialia. But although stockpiled, low-cost oil derivatives had so far helped offset the sharp rise in global crude oil, petrol prices were expected to increase as these reserves were depleted.

"We have seen an increase of only about 100 or 200 riels because we can mix newly imported gasoline with what we have in storage, but prices could increase higher if they keep importing the newly priced oil," he said. "Even if the price remains stable at $58 next week, you might see price of gasoline and diesel increase by 200 or 300 riels more."

Heu Heng, deputy director general for Cambodian petrol giant Sokimex, said his company had increased prices by 50 riels per litre at the pump, to around 3,400 riels for "gold" grade gasoline.

"It is normal that when the price of international crude oil increases, we increase our prices, too, because we import everything from outside," he said. "We cannot predict the international oil price, but when it is down we will drop down as well."

According to government statistics, retail prices for gasoline increased from 2,950 to 3,350 riels per litre last week - an increase of over 13 percent - while diesel rose from 2,850 to 2,950 riels over the same period.

We can mix newly-imported gasoline with what we have in storage.

But Rong Chhun, president of the Cambodian Independent Teachers Association, which has lobbied the government to introduce fuel subsidies, told the Post that high petrol costs were a result of price gouging by distributors, and called on the government to monitor pump prices to ensure they remain fair for Cambodians.

"Prime Minister Hun Sen appealed often to private companies to lower the price of gasoline, but it only works for a short time," he said. "As prime minister of the country, [he] has to issue a strong order to private companies. Even if there is a free-market policy, it still needs to be managed by the government."

Sam Rainsy Party lawmaker Yim Sovann said the price increase was a result of of the retail petrol sector operating as a cartel, and that the biggest petrol retailers have "formed a team" to set artificial prices. He said Cambodia also taxed gasoline at the rate of 1,000 riels per litre, and called on the government to abolish the tax - a measure that would benefit economic development as well as the poor.

"The high price of gasoline and diesel will drive out investors from Cambodia, and we will face challenges from competitors," he said. "I think investors and people are both facing the same problem once goods prices increase and lead people into poverty."

Hun Sen is “Cambodia chauffeur” [or is it “chauffard*”?]

Cambodia's one-eye "chauffard*" (Photo: Bloomberg)

22 Dec 2008
By Ky Soklim Cambodge Soir Hebdo Translated from French by Tola Ek Click here to read the article in French

*Chauffard: French word for reckless driver

During a speech given at a distribution of diplomas at the Pedagogy University in Phnom Penh on 22 December, Hun Sen talked about various current issues on internal politics.

While announcing that his speech was the last one for this year, the prime minister talked about various issues related to recent news, and retail gasoline price was also a topic he touched on. “If I yell against high prices, then they will drop. But, if I don’t say anything, they do not move. Therefore, I am asking the national companies Tela and Sokimex to make another effort, a new lowering of the price will be a year-end gift to me. It is more difficult to make the request to foreign companies such as Total and Caltex. I am thinking of negotiating directly with all the companies soon, on the policy of gasoline price. This is important because it influences the cost of transportations.”

Hun Sen then turned to traffic road safety and especially on the application of the law for mandatory helmet use, a law which will be strictly observed by the cops starting 01 January 2009. “I am appealing to all Cambodians, all motorcycle drivers, to wear helmet at 100% to avoid a large number of fatal accidents. Helmet wholesalers should not take advantage [of this issue] to increase their price. The cost of traffic accidents is higher for the state than the fight against AIDS and demining. Civil servants should set example and they must all wear helmets. Each ministry must control its personnel and check that the law is respected. If civil servants do not respect the law, how can we ask others to do it?” Hun Sen said.

Hun Sen also touched upon control and repression measures against gambling parlors. “Since my declarations made in the past weeks, gambling parlors equipped with unauthorized slot machines, i.e. outside of hotels, have been shut down. Now, we are proceeding to the control of the nationality of gamblers who are using these parlors which are prohibited to Cambodian nationals. Some parlors are protected by high-ranking officials. Those who are identified as responsible for these actions will be demoted from their positions,” Hun Sen threatened. He also discussed about the need to control betting parlors and karaoke institutions as the latter are sometimes linked to drug trafficking.

Hun Sen finally talked about his political longevity. “I was the youngest PM, at 32-year-old. I am still the one who remains the longest in this position: 24 years. At the end of this mandate, it will be 29 years. It is certain that I will again be the candidate in 2013 since the opposition is so weak. But, being PM is not simple. If a bad decision is taken, the entire country will suffer from it. Cambodians know that their chauffeur, even with only one eye, he pays attention to his driving,” Hun Sen ended by mentioning about one of his eyes he lost more than 30 years ago.

Inflation on Goods Eases, But Just a Little

By Ros Sothea, VOA Khmer
Original report from Phnom Penh
27 November 2008

Click here to listen to the Khmer audio program

The price of rice and other goods in markets have fallen slightly in November.

Inflation pressure has eased on Cambodia, but only a little, as the prices of international commodities and basic foods has slightly decreased, economists say.

Government officials and analysts said the decrease, brought on by lower fuel prices and other reduced costs, was still not enough.

“The price of commodities has a little bit reduced, not much. So we are trying to reduce it further,” said Hang Chuon Narong, general director of the Ministry of Economy and Finance.

The inflation rate was 17 percent in November, down from 30 percent the month before, he said.

The government would like to see an inflation rate of 9 percent in early 2009, he said.

The inflation rate can only be reduced if the price of fuel, which heavily influences commodities, continues its fall on international markets, said Kang Chandararoth, head of the Cambodia Institute of Development Study.

Crude oil on Saturday was down to $48 per barrel, compared to $147 per barrel in July. In Cambodia, a liter of fuel cost around 3,500 riel, less than $1, compared to 5,700, around $1.40, in August.

The price of high-quality jasmine rice was down to $40 per 50 kilogram sack in most markets, while the lower-quality rice consumed by most Cambodians was around $21 per 50 kilograms.

Vegetables in the markets followed the trend, by about 1,500 riel, or $0.37, in November, said market retailer Phay Sokhen.

“Now there is no more rain, so the price of vegetables has reduced a little bit,” she said. “It depends on the climate, not the price of gasoline.”

Fish prices had decreased by about 2,000 riel per kilogram, fish mongers said Saturday, but mostly due to the season.

Meanwhile, commodities imported from neighboring countries, especially Thailand, were down by around 1 percent in November, thanks to a recession of the Thai baht.

Pork remained the same, around 16,000 riel, or $4, per kilogram, and chicken held steady at 18,000 riel, or $4.50, per kilogram.

“I bought expensive, so I have to sell expensive too,” said Hing Chantha, a chicken retailer at Central Market.

Many Phnom Penh residents, from housewives to students to factory and construction workers said they had seen little benefit so far from a lowered inflation rate. Prices had dropped, they said, but not enough to make a difference.

Cambodian People’s Party lawmaker Cheam Yiep said the price of products always increased when fuel prices were high, but not reduced when the fuel price fell.

“Some business people are greedy,” he said. “Although some products have reduced their prices, they won’t follow it.”

Sam Rainsy addressing constituents in Prey Veng province

On 02 June 2008, MP Sam Rainsy visited constituents in the province of Prey Veng where he gave a speech on the economic and political On 02 June 2008, MP Sam Rainsy visited constituents in the province of Prey Veng where he gave a speech on the economic and political situation in Cambodia.