Inflation Down Amid Plummeting Oil Prices

Inflation slowed significantly last year amid plummeting gasoline prices, the National Bank said in its annual report released on Monday.

The rate of inflation was 1.2 percent in 2015, down from 3.9 percent the previous year, as average gas prices fell by 23 percent over the course of last year, from 5,090 riel at the end of 2014 to 3,900 riel at the end of 2015.

A motorist fills up at a gas station in Phnom Penh last year. (Siv Channa/The Cambodia Daily)
A motorist fills up at a gas station in Phnom Penh last year. (Siv Channa/The Cambodia Daily)

“The inflation in 2015 was low compared to 2014 due to the drop in gasoline prices, low inflation in countries exporting goods into Cambodia and the effective management of money supply,” the report says.

Amid falling global prices, the Commerce Ministry also lobbied gas companies throughout the year to drop their prices at the pump, calling regular meetings to ensure savings were being passed on to consumers.

The National Bank report says much of the fluctuation in gas prices was due to trends in the global economy, notably lower demand due to slowing growth in much of the world.

Bank Governor Chea Chanto says in the report that gas prices are expected to remain stable in the coming year.

“In the situation in which the oil supply is forecasted to be stable, while the demand continues to be weak, the gas price is expected to be low,” he is quoted as saying.

Huong Sunhin, manager of the station section for local oil distributor PTT (Cambodia), said two main factors drove last year’s 23 percent drop in gas prices.

“Firstly, it was because the prices on the international market dropped a lot and, secondly, we met with the Commerce Ministry many times to discuss the price so that all companies would lower their prices,” he said.

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