As of the final week of March, Cambodia has experienced one of the sharpest fuel price increases globally, with petrol prices rising by nearly 68% to exceed 5,000 riel per liter amid global supply disruptions linked to conflict in the Middle East. These pressures have been amplified by structural vulnerabilities in Cambodia’s fuel supply chain. Historically, more than 60% of petroleum imports have been sourced from Thailand and Vietnam. However, export restrictions and border disruptions have forced Phnom Penh to pivot toward alternative suppliers such as Singapore and Malaysia. The severity of the disruption was underscored by the temporary closure of roughly one-third of the country’s 6,300 petrol stations during the third week of March.
In response, the government introduced immediate price relief measures, reducing fuel prices by $0.065 per liter effective March 20, with an additional $0.01 reduction triggered when global gasoline prices exceed $90 per barrel and diesel surpasses $100 per barrel. It has also maintained zero-rate customs duties on fuel imports and expanded tax relief measures. These include eliminating the additional tax on gasoline and diesel, reducing the special tax on diesel from 4% to 0%, and lowering the additional tax rate from 10% to 4%, with the state absorbing the remaining 6%. Collectively, these measures aim to cushion domestic consumers while managing inflationary pressures.
At the same time, the Ministry of Economy and Finance has imposed fiscal tightening measures across government agencies. Under a March 20 directive, ministries and state institutions must suspend 30% of their fuel, lubricant, and travel expenditures. While the Ministry of National Defense and the Ministry of Interior’s public security arm are exempt, they are still required to operate within existing budget ceilings unless exceptional circumstances arise. Agencies have also been instructed to reduce in-person travel, workshops, and meetings, shifting to virtual platforms wherever possible, and to limit overseas travel to essential engagements only.
Beyond short-term stabilization, the government is accelerating structural adjustments to reduce reliance on fossil fuels. Effective April 1, the General Department of Customs and Excise (GDCE) introduced sweeping tariff reductions on green energy and electrification products. Import duties were cut from 35% to 0% on electric stoves and electric vehicles (EVs), reduced to 7% on plug-in hybrids, and eliminated entirely on solar systems, lithium batteries, and EV components. These measures signal a strategic push toward energy diversification and long-term resilience.
In parallel, Energy Minister Keo Rottanak confirmed that the government has initiated discussions with Australia’s Woodside Energy to secure liquefied natural gas (LNG) supplies for a planned 900-megawatt power plant expected to begin operations next year. He also emphasized the importance of accelerating regional grid interconnection within ASEAN to enhance energy security.
Taken together, these developments reflect immediate fiscal and administrative interventions to contain price shocks, alongside longer-term efforts to diversify energy sources and strengthen supply resilience. For U.S. businesses, the evolving policy landscape highlights both short-term market volatility and emerging opportunities in energy infrastructure, LNG supply, and clean energy technologies.
