NAYPYITAW — The Ministry of Electricity and Energy is negotiating with suppliers to bring down fuel oil prices, said managing director of the ministry U Thant Sin.
U Thant Sin, who is also the vice-chairman of the government supervisory committee on petroleum and petroleum product business activities, said during a monthly press conference on Thursday in Naypyitaw that the ministry wants to lower fuel oil prices to less than 1,000 kyats per liter in Yangon.
“We have requested that all fuel oil distributors reduce prices to below 1,000 kyats in Yangon. The Myanmar Fuel Oil Importers and Distributors Association has also asked the distributors to sell at reasonable prices,” said U Thant Sin.
The government can only request that distributors reduce the price, but cannot impose price controls. The price is determined by market forces and the law of supply and demand, he said.
Fuel oil prices have increased mainly due to the weakening of the kyat against the US dollar. Since June, the kyat has slumped against not only the greenback but also regional currencies like the Thai baht and Singapore dollars.
Singapore is the main source of Myanmar’s fuel imports, and prices have declined sharply in Yangon compared to last month as the Singapore dollar weakened, according to U Thant Sin.
Fuel oil prices increased by around 300 kyats per liter over the past three months, with prices varying from place to place depending on transportation costs.
On Thursday in Yangon, a liter of premium diesel was sold for 1,075 kyats, a liter of Octane 92 for 985 kyats, and a liter of Octane 95 for 1,065 kyats. The prices are higher outside of Yangon due to transportation costs.
The ministry has intervened in the market twice before, in December 2017 and April 2018, following price spikes.
The Myanmar Investment Commission relaxed regulations last year and allowed 100 percent foreign-owned companies to invest in local fuel oil distribution. Since then, a few foreign companies have inquired about the possibility, but none has made an official proposal.
“We can accept this if the market is free and fair without a monopoly and anyone can sell in the market,” said secretary of the Lower House Investment and Industrial Development Committee U Aung Aung Kyaw Oo.
In response to the fuel oil price increase in the domestic market, the Ministry of Electricity and Energy has sold domestically produced petroleum, but this is only suitable for use in motorbikes.
Since April, the ministry has sold 15 million gallons of domestically produced petroleum at 3,800 kyats per gallon.
Translated from Burmese by Thet Ko Ko.