Vendors Hurt by Surge in Price Of Cooking Gas

Cooking gas prices have skyrocketed since last week in Phnom Penh, leaving restaurateurs unsure how they are going to keep their businesses afloat and gas sellers complaining of severe shortages.

However, gas importers, while admitting to shortages, expressed surprise that retail prices had reach­ed such heights given the prices they were charging distributors.

Prum Saran, manager of the Bayon Gas Shop on Street 19 in Phnom Penh, said Tuesday that he had no more cooking gas to sell to customers until the end of March, as the importer he buys from has run dry.

The apparent shortage has led him to nearly double prices since last week. On Tuesday, Bayon Gas was charging $35 for a 15-kg canister of cooking gas, up from $19 a week earlier. A 48-kg tank is now retailing for $120, double the $60 his company charged last week.

“I have no idea what’s going on, but the [importing] company assur­ed me that they will have enough gas in April,” Prum Saran said.

Bayon Gas was not alone in the higher prices it was charging. An em­ployee at the Tann Samei gas shop near Phsar Thmei said Monday the shop has increased the price of a 15-kg tank from $20 to $30 in just a few days.

But it is restaurant owners that are most strongly feeling the pinch of the spike in gas prices.

Long Poly, general manager of the Khmer Kitchen Restaurant on Street 310, said his restaurant had never faced such problems with cooking gas. He said his eatery uses at least 150 kg of cooking gas per month, which translated into about $2,000’s worth in February. He said he feared the spike in prices could push that cost to $3,500 this month.

“I am really worried about the price of gas,” Long Poly said. “I am thinking about increasing the prices of dishes on the menu, but I am worried of losing customers.”

The Tonle Bassac Restaurant on Mao Tse Toung Boulevard has al­ready raised its menu prices in the face of spiking prices of gas and in­gredients, restaurant manager Sim Yong said Tuesday.

“The price of gas is leading to difficulties in our business,” she said.

“If the government can’t intervene to stabilize the price [of gas and food], our business will close its doors,” Long Poly said.

Cooking gas importers said this week that regional shortages are driving up prices, but added that even so, the price being charged by middlemen was well above what it should be.

Chan Virak, Cambodia petroleum liquid gas manager for oil giant Total, said companies import cooking gas from Thai­land and Viet­nam. However, both countries are experiencing shortages, which has prompted the Thais to limit exports.

Sokimex Group Vice President Hour Heng said Monday that environmental concerns have prompted many Thais to use LPG fuel in­stead of diesel, putting pressure on the supply of cooking fuel available for export.

But despite conceding a shortage, both companies expressed surprise at the retail prices being charged by distributors.

Chan Virak said Monday that Total had raised the price of 15-kg tanks by just a few dollars.

“At a Total gas station last week [a 15-kg tank] sold for $18 and today it will be $21,” he said. “$30 for 15 kg of cooking gas is too much for Phnom Penh residents.”

Hour Heng said Sokimex is selling its 15-kg tanks for between $16.50 and $17.20, adding that distributors should not be charging customers more than $20.

“We call on our clients not to over-raise [their prices],” he said. “I am extremely surprised to hear that the price of cooking gas in Phnom Penh jumped to $28 or $30.”

Khat Sarin, an assistant to Sok­imex President Sok Kong, said Sokimex is hoping to ease the supply crunch, and thereby lower prices, next month by importing cooking gas from China, Singapore and the Middle East.

Phnom Penh Deputy Governor Mann Chhoeun said Monday that City Hall is currently at a loss as to how to tackle the issue of rising cooking gas prices, which he said is a problem on a national scale.

“To find a solution we should have a meeting first and figure out the real problem so we can take some measures,” he said.

Commerce Ministry Undersec­retary of State Mao Thora said his ministry is actively investigating the issue but is not yet sure how to best tackle the problem.

“We are seeking information from gas importers to find out how we can solve the matter,” he said.

Finance Ministry Secretary of State Chea Peng Cheang said the government has already stopped taxing imported cooking gas based on a percentage of its value, but there is little more it can do at the moment to keep prices down.

“It is a free market,” he said. “The government tries to intervene, but sometimes there is no effect.”

(Additional reporting by Tim Sturrock)

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