PHNOM PENH/SIHANOUKVILLE — Long lines of tuk-tuks formed outside LPG stations in Sihanoukville this week as gas prices surged sharply, triggering concerns over supply stability and rising living costs.
From the evening of March 22 through the morning of March 23, drivers queued for hours to refill liquefied petroleum gas (LPG), which many use as their primary fuel source.
According to drivers and residents, LPG prices have more than doubled in recent days. Previously sold at around 1,900 riel per liter and 3,800 riel per kilogram, prices have now climbed to approximately 4,400 riel per liter and as high as 10,000 riel per kilogram. An increase of over 105%.
Several LPG stations have temporarily closed, raising concerns about tightening supply.
Is LPG more important than gasoline?
Public attention often focuses on gasoline price fluctuations, LPG plays a critical role in Cambodia’s economy, particularly among lower-income households and informal sector workers.
LPG is widely used for tuk-tuks and small transport operators, street food vendors, restaurants, and household cooking.
Cambodia imports nearly 100% of its refined fuel and LPG, leaving it exposed to regional supply conditions and global energy disruptions.
On March 22, Sokimex, one of the country’s major energy distributors announced it would suspend LPG imports beginning April 1 due to sourcing difficulties.
Minister of Mines and Energy Keo Rottanak addressed the public in an eight-minute Facebook video, urging calm and encouraging energy conservation. He attributed current supply pressures partly to global fuel disruptions linked to geopolitical tensions in the Middle East.
Global energy markets have remained volatile amid ongoing conflict in the region, with shipping routes and supply chains experiencing periodic strain. Although Cambodia is not directly involved in these conflicts, its reliance on imported fuel makes it vulnerable to regional export adjustments and international price movements.
How will this affect tuk tuk drivers?
For Cambodia’s estimated tens of thousands of tuk-tuk drivers, many of whom operate on narrow margins, the increase has been severe.
“Before, 10,000 riel of gas could last a full morning. Now it costs almost 20,000 riel,” said one Phnom Penh-based driver.
Despite higher fuel costs, driver earnings have not increased proportionally. Ride-hailing app competition, reduced passenger demand amid inflation, and general economic tightening have limited fare growth.
Many drivers report that daily income now barely covers fuel, food, and loan repayments.
Economists note that LPG price spikes can have a broader ripple effect, particularly on food prices and transport fees, both key components of consumer inflation.
What broader inflation concerns can we expect?
Cambodia’s inflation has moderated compared to the post-pandemic peak, but energy costs remain a key driver of price volatility. In an import-dependent economy, fuel price shocks quickly transmit into transport and supply chain costs.
Unlike oil-producing countries in the region such as Malaysia, Cambodia has no significant domestic refining capacity and relies on imports from Singapore, Thailand, Vietnam, and other regional suppliers.
When major distributors adjust imports, as in the case of Sokimex’s announcement, local market pressure can intensify rapidly.
Will there be a call for intervention?
Transport operators and small business owners are hoping for some form of temporary intervention, whether through supply stabilization measures or targeted relief for informal workers.
Analysts argue that while gasoline price increases attract more media attention, LPG inflation disproportionately impacts lower-income earners, potentially widening economic pressure at the bottom of the income ladder.
For now, authorities are urging conservation and monitoring supply conditions as the regional energy situation evolves.
