Concerning the price increase, Radnaasuren Lkhamaasuren, Deputy Head of Mineral Resources and Petroleum Authority of Mongolia (MRPAM), explained, “Oil dealers recovered around 60 percent of their loss through the excise tax exemption. However, border price had to increase due to oil price surge in the global market. Thus, oil dealers have increased fuel price by MNT 20- 30 per liter in order to prevent price fluctuation.” Fuel Policy Department of the Ministry of Mining and Heavy Industry informed that the ministry is holding a policy to maintain retail price of fuel. There will not be any fuel shortage issue in the future.

Another good news is the reducing USD /MNT rate. This will have significant impact in maintaining fuel price.” MRPAM is expected to collect MNT 291.8 billion to the State Budget. The officials informed that a total of MNT 223.4 billion will be collected from oil export revenue. For instance, January report shows that MNT 21.9 billion has been accumulated to the budget, of which MNT 19.2 billion were from oil export revenue, displaying 7.5 percent of annual plans. As of February 5, Mongolia’s fuel reserve could cover 39 days of average consumption, informed the related officials.

Additionally, Organization of the Petroleum Exporting Countries’ (OPEC ) decision to reduce production output and the political instability in the second half of 2017 had significant impact on global oil price. As for Mongolia, border price at Mongolia-Russian borders have been increased since July 2017, reaching USD 140 per ton. International Monetary Fund’s Extended Fund Facility program also forced Mongolia to increase excise tax on gasoline in July and November of last year. Furthermore, Rosneft increased their border price of fuel this month.