ALL types of fuel oil have been priced at above K1,400 per litre, indicating a steady increase in prices, according to Yangon petrol stations.
On 30 December 2021, the prices stood at K1,340 for Octane 92, K1,390 for Octane 95, K1,315 for diesel and K1,325 for premium diesel in Yangon, whereas it jumped to K1,445 for Octane 92, K1,495 for Octane 95, K1,440 for diesel and K1,450 for premium diesel on 11 January 2022. There is a price gap of over K100 per litre within two weeks, according to the local fuel oil market.
The fuel oil price is highly correlated with the exchange rate. At present, the exchange rate stands at around K2,000 in the local forex market.
When a dollar was valued at only K1,330 in early February last year, the fuel oil was estimated at K590 per litre for Octane 92, K610 for Octane 95, K590 for diesel and K605 for premium diesel in early February 2021 in the domestic retail market.
Consequently, in a bid to steer the dollar rally in the local forex market, the Central Bank of Myanmar (CBM) sold US$15 million at its auction market rate in January this year. Additionally, the Ministry of Commerce in coordination with the Myanmar Petroleum Trade Association carried out a scheme to distribute fuel oil at fairer rates through the government- sponsored petrol station chains. The total volume of fuel oil that are sold at very cheap rates is equivalent to the amount that the oil importers directly purchased the foreign currency from the CBM. The oil has been distributed at the subsidized rate starting from 22 September.
The CBM has directly sold $53.4 million to the fuel oil sector so far.
Normally, Myanmar yearly imports six million tonnes of fuel oil from external markets, the Ministry of Commerce indicated. — NN/GNLM