Imports of petroleum products exceed $1.56 bln in seven months

Myanmar imported more than US$1.56 billion worth of petroleum products during the first half (Oct-Apr) of the current financial year 2020-2021, as per the Myanmar Customs Department.
The figures indicated a sharp drop of over $650 million compared to the corresponding period of last year.
Normally, a monthly oil import is estimated at $400 million, yet the oil importers are facing the pandemic induced container shortage problem in maritime trade and the banking restriction. Nevertheless, oil importers via land border can use informal payment Hundi system instead, said an importer.
At present, the domestic fuel oil price has now risen above 30 per cent per litre in three months, as the heightened coronavirus restriction sparked oil demand concerns, coupled with Kyat depreciation.
The fuel oil was pegged at around K620 per litre for Octane 92, K750 for Octane 95, K660 for diesel and K670 for premium diesel in early February 2021 in the domestic retail market.
On 9 July, it rallied to the highest of K1,060 for Octane 92, K1,080 for Octane 95, K1,025 for diesel and K1,030 for premium diesel, according to the local fuel oil market.
Domestic oil price is positively related to the global market and the dollar value. The soaring demand drives up the oil prices to rally higher, with WTI climbing above $73.21 per barrel.
Additionally, the foreign exchange rate also affects the petroleum price. Kyat is weakening in the local forex market, with around K1,650 per dollar on 9 July. In mid-February, a dollar was worth only K1,430.
Normally, Myanmar imports fuel oil primarily from Singapore, with monthly volumes touching 200,000 tonnes for gasoline and 400,000 tonnes for diesel. There are about 2,000 fuel stations and over 50 oil importer companies in Myanmar, Myanmar Petroleum Trade Association stated.
In early June 2021, the Ministry of Electricity and Energy notified the private sector of keeping the oil storage above 35 per cent of the storage capacity of the tanks to avoid the possible discrepancy between demand and supply.
Last year, the domestic oil prices have declined to start from January owing to a fall in global oil prices. On 8 January 2020, oil prices were pegged at around K905 per litre for Octane 92, K995 for Octane 95, and K985 for diesel and premium diesel. Following the global market crashing, the domestic oil price plunged to more than 50 per cent in April against January’s prices.
In late April 2020, the oil prices touched the lowest of K290-330 per litre for Octane 92, K430-455 for Octane 95, K435-465 for diesel, and K445-475 for premium diesel, according to the domestic oil market.
Ninety per cent of fuel oil in Myanmar is imported, while the remaining 10 per cent is produced locally. – KH/GNLM