Myanmar is facing fuel shortages partly because of the regime’s controls over US dollars.
In early April, the regime-controlled Central Bank of Myanmar ordered that foreign earnings must be deposited with licensed banks and exchanged for kyats within one working day at the official rate. The regime also ordered that fuel be sold at fixed rates.
While tightening its controls over the currency markets, the regime has not sold off its US dollars. The restricted access to dollars has blocked fuel imports, which have declined, according to an oil importer.
“Imports have almost halved. Major importers now only try to keep the pumps working and they can’t sell fuel to the wholesale market like before,” said the manager.
Another fuel importer said firms lacked access to dollars.
“This fuel shortage resulted from the scarcity of US dollars. Imports have declined by two-fifths. Oil tankers have not been emptied because we can’t pay in dollars. There is steady market demand but supplies are low and stocks may run out,” the source said.
The regime’s Global New Light of Myanmar newspaper reported that fuel primarily comes from Singapore, with monthly volumes touching 200,000 tonnes of gasoline and 400,000 tonnes of diesel.
The regime pays US dollars to major fuel importers like BOC and Denko but even those companies do not receive enough dollars to meet retail demand, according to market insiders.
The regime’s supervisory committee for imports, distribution and supplies of fuel ordered distributors to sell at fixed rates on April 20. In Yangon, the rate was 1,995 kyats per liter of 92 Ron octane, 2,045 kyats for 95 Ron octane, 2,205 kyats for diesel and 2,235 kyats for premium diesel with prices varying across the country.
A Yangon taxi driver said: “Unlike in the past, I cannot wait until I am low on fuel because I never know whether I will be able to refill. We can still buy fuel in Yangon but I don’t know about other places. Prices are high.”
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