Oil imports dip amidst economical green shift

CAMBODIA spent over $2.17 billion on diesel and petroleum imports in 2023, marking a 7.6% decrease from the previous year.

According to the General Department of Customs and Excise (GDCE), diesel imports accounted for $1.32 billion, a 12.2% increase, while petroleum imports dropped slightly by 0.26% to $850 million.

Lim Heng, vice-president of the Cambodia Chamber of Commerce (CCC), attributed the decline in the value of oil imports to lower prices in the first half of last year, noting that the country’s production chain continues to perform well.

"Although external factors affected global demand, our production sector remained strong. The drop in oil import [expenditures] was due to the fall in global oil prices early last year," he stated.

On the other hand, Ky Sereyvath, an economic researcher at the Royal Academy of Cambodia, linked the decrease in fuel imports in 2023 to the rise in oil prices following the armed conflict between Russia and Ukraine, leading to reduced domestic demand from the production sector, including factories and enterprises using generators.

He noted the growing trend towards electric vehicles and an increase in renewable energy.

"The decline in fuel imports last year does not imply a drop in our production capacity. Some factories and enterprises have shifted to alternative energy sources, like clean energy or solar power, to support their production and reduce costs," he explained.

The Ministry of Mines and Energy is currently exploring the potential establishment of a national company for offshore oil exploration, aiming to reduce the country’s reliance on imports.

Ministry spokesperson Penn Sovicheat identified Singapore, Thailand andVietnam as important fuel sources for Cambodia.

He said the country aims to raise its renewable energy share to at least 70% by 2030, aligning with environmental goals and economic growth, focusing on energy efficiency.

Energy minister Keo Rattanak highlighted at a press conference last December the importance of eco-friendly sources such as solar, wind, hydro and biomass in meeting the country's environmental and economic targets.

"As we produce more electricity from renewable sources, we see the true benefits of sustainable energy, including greener buildings, appliances, electric vehicles and the electrification of industry and agriculture," he said.

The ministry projects that the Kingdom’s oil consumption will rise to 4.8 million tonnes by 2030, up from 2.8 million tonnes in 2020.