Gas prices are set to further increase in North Korea as the United Nations prepares to vote Monday on a new sanctions package that may include a full oil product embargo to North Korea.
Gas stations in Pyongyang told foreign residents that a new price hike is anticipated on gas supplies, informed sources told NK News on Saturday, though new rates have yet to be established.
In addition, new restrictions have, since Thursday, been preventing customers from filling up jerry cans to buy extra supplies, the sources added, while a number of gas stations have closed in the city.
Traffic, however, reportedly remains normal throughout the city, the sources said, something which is consistent with what was observed following the initial April price increase throughout the country.
The information tracks with Daily NK reports on Saturday that said petrol prices in Pyongyang increased in September from 18,000 won to 23,000 won per kilogram, with diesel set to “exceed 12,000” won per kilogram.
Those new rates – petrol is now $2.82 kilogram at current unofficial exchange rates, while diesel is $1.47 – are also being observed in other regions of the country, the Daily NK said, such as Hyangsan, Yanggang Province.
The additional spike in fuel prices comes after a leaked U.S. draft of new UN sanctions emerged on Thursday which, among other things, proposes a full embargo on oil product deliveries to the North.
The resolution, if approved, would mean UN member states would be prohibited from direct and indirect “sales or transfer” of all “crude oil, condensates, refined petroleum products, and natural gas liquids.”
News of the possible embargo might be impacting prices throughout the North, one analyst said.
“North Korean markets function on limited information, which makes rumor and hearsay all the more influential,” said Christopher Green of the International Crisis Group.
“Prices here may be rising rapidly based on the mere risk that official imports of oil products will be significantly reduced, not the reality.
“With that being said, the authorities are bound to prioritize certain sectors such as the military and agriculture at the expense of the wider civilian economy, so the losers in that process are going to feel the pinch.”
Despite the leaked U.S. sanctions proposal, experts told NK News last week it would be unlikely that the U.S. could count on full support for the new sanctions package.
“This is a total pipe dream Resolution – can’t imagine anything like it being agreed,” one informed source said about the likelihood of it being approved by the Security Council. “Certainly (it) wasn’t discussed with the Chinese.”
David Straub, a former East Asia hand at the U.S. State Department, agreed that opposition to it would be likely.
“As written, the PRC and Russia would probably veto it,” said Straub. “Russia and the PRC will probably object especially to the oil cutoff and the personal designations of Kim Jong Un, but they will find many other provisions problematic, too.”
Petrol and diesel prices abruptly spiked by about 80% in April, with petrol increasing by an additional 14% in mid-August, data at NK Pro previously indicated.
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Featured Image: 5Q7A0266 by nknews_hq on 2016-10-04 11:05:31