Fuel prices in Myanmar have more than doubled since the junta’s February 1 coup, as the cost of crude oil has jumped in international markets and the kyat has weakened significantly against the US dollar amid post-coup political turmoil.
Before the coup, the price of a liter of octane or diesel fuel was around 700 kyats. Now, it has soared to over 1,500 kyats.
“Crude oil prices have hit a record high this year in the international market. Not only our country, but other countries are also experiencing price hikes. But in Myanmar it is coupled with the weakening kyat,” a manager of a Yangon fuel importer told The Irrawaddy.
On Tuesday, oil prices hit their highest level in three years, climbing above US$80 a barrel in the global market amid tight supply and surging demand.
This week, the US dollar exchange rate reached a record high in Myanmar of around 2,500 to 2,700 kyats per US dollar. Prior to the coup, the exchange rate was between 1,300 and 1,400 kyats per US dollar.
The Central Bank of Myanmar has been selling US dollars to oil importers through private banks, but the amounts are not sufficient for all the oil importers who are now finding it hard to purchase US dollars in the open market.
“It is mainly because of the exchange rate. And it is difficult to buy US dollars. Previously, you could buy US$1 million easily, but now you can only buy smaller amounts from several currency dealers,” the manager of a Mandalay-based oil importer told The Irrawaddy.
Despite the increase in global crude prices, fuel prices in Myanmar are unlikely to have more than doubled if the kyat had not depreciated steeply, added the manager.
On Monday, coup leader Senior General Min Aung Hlaing urged regime ministers to find ways to reduce the use of imported fuel and to aim for the manufacture and operation of electric buses and vehicles.
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