In brief
On November 5, 2026, Cambodia announced a $600 million subsidy package aimed at countering soaring fuel and electricity costs driven by Middle East conflict. The package includes direct tariff cuts, tax reductions, and duty waivers on oil, gas, and electric vehicle‑related imports, while the government noted gasoline and diesel prices had risen 31% and 46.7% respectively. Economic analysts in the country say the measures are intended to protect low‑income households and SMEs amid a critical period of global fuel inflation.
On November 5, 2026, Cambodian Prime Minister Hun Manet announced that the government has allocated more than US$600 million in subsidies to cushion the domestic economy from surging global fuel prices caused by Middle East conflicts, broadcasting the statement while visiting households in Pursat province.
Subsidy Framework and Market Impact
According to Xinhua, the subsidy package includes direct electricity tariff reductions, targeted tax cuts, and lowered import duties on oil and gas, as well as reduced tariffs on electric vehicles, plug‑in hybrids, electric stoves, and solar‑powered devices. These measures are designed to keep fuel and electricity costs under control as long as international markets remain elevated.
Xinhua’s report detailed that the retail price of regular gasoline in Cambodia stood at 5,050 riels (about US$1.24) per liter on Thursday, a 31 percent increase from pre‑conflict levels in February. Diesel prices climbed 46.7 percent, reaching 5,650 riels per liter, according to data from the Ministry of Commerce.
"To date, we have subsidized more than 600 million dollars to curb rising fuel costs and stabilize electricity prices," said Hun Manet.
According to Xinhua, Thong Mengdavid, deputy director of the China‑ASEAN Studies Center at the Cambodia University of Technology and Science, noted that the government’s strategy of subsidizing retail fuel through customs duty waivers and value‑added tax reductions provides a crucial fiscal cushion for economic resilience. He explained that fuel price hikes increase transportation and production costs, drive up inflation, and erode purchasing power, especially for food and agricultural products, thereby slowing broader economic activity.
Xinhua reported that low‑ and middle‑income households, informal workers, and small‑ and medium‑sized enterprises are particularly vulnerable to the crisis due to steeper living and operating costs and limited financial buffers. The country’s reliance on imported petroleum further compels the need for such subsidies, as Cambodia has not yet exploited offshore oil reserves.
Prime Minister Manet said that the subsidy programs would remain in place as long as global fuel markets stay elevated, signaling the government’s commitment to supporting households and businesses amid continuing international volatility.
