Global oil price down but not local prices

Despite the fall in global oil price from US$94 per barrel in January 2014 to US$50 in the beginning of January this year, local petroleum and diesel prices remained the same.

“Although the global oil price has dropped sharply, local fuel prices are not falling. Usually when the global oil price increases, local prices should also follow suit. But local business people seem to focus much on benefit. They should cut the fuel prices when global oil price decreases so that it can match the international market,” said Dr Khin Maung Nyo, a writer.

“The global oil price has been dropping for quite some time, but local fuel prices are not dropping. Previously, only one person has the permit to import edible oil. Even though the oil market has been liberalised, it still seems the same. It has to import separately using oil tankers because other ships are not allowed to carry fuel. Thus, if we want to use oil for our factories, we have to buy with the price they sell. This should not be the case,” said a local business person.

Those who are permitted to import oil from foreign countries include people that import oil for their own use as well as those who sell by opening private fuel stations. Yet, some do not import but just purchase the already-imported oil and sold them at their private stations. Local business people want the oil importers to reduce local oil prices since the international price has been falling.

On December 5, 2014, local petroleum price was US$3.7 per gallon, diesel: US$4.3, octane: US$4.23 and advanced diesel: US$4.455 while the international petroleum price was US$1.79 per gallon. On January 2, 2015, it costs US$0.8 for a litre of petroleum, US$0.78 for a litre of diesel, US$0.75 for a litre of octane and US$0.85 for a litre of advanced diesel respectively in local while it costs US$53.27 for a barrel of crude oil in international market.