The Energy Crisis Is Already Here

The energy crisis isn't coming to Cambodia's construction sector. It's already here.

Diesel is up 84% since February. LPG has more than tripled. A friend in F&B told me his gas bill went from manageable to existential in a month.

On our sites, it's simpler than that. Nothing moves without fuel. Trucks, concrete, steel, aggregate. Every delivery now carries that increase.

The government moved fast. VAT on fuel cut. Customs duty removed. Travel budgets frozen. Ministries told to stay put.

Serious measures. But they buy time. They don't change the structure.

Cambodia imports all its fuel. No refinery. No real reserve. Everything comes through Sihanoukville, tied to Singapore pricing, tied to a global market that just lost a major artery through Hormuz.

Pressure from both sides

From the ground, the pressure is coming from both sides.

Costs are rising. Fuel, transport, materials, equipment.

At the same time, demand is weakening. Businesses slow down. Buyers hesitate. Projects get delayed or quietly dropped.

It's not one problem. It's both, at once.

This changes what gets built

Speculative residential was already under strain. Rising NPLs, softer demand. This adds another layer.

The projects that move now will be different. Institutional money. Donor-backed work. Owners with cash who don't need to wait for financing.

Everyone else starts to pause.

For contractors, the next 12--18 months will filter the market.

If you're carrying debt and need a constant pipeline, this gets uncomfortable fast.

If you're lean, unleveraged, and close to institutional clients, the landscape shifts. Fewer competitors. More selective work.

The fertilizer question

There's a second-order effect that hasn't really entered construction conversations yet.

Fertilizer.

A large share of global supply moves through the same corridor. Cambodia imports all of it. If this disruption stretches into planting season, food prices follow later.

That feeds back into everything. Household spending tightens. Demand for built space drops further.

Underwriting risk with last quarter's assumptions

What's striking is how many decisions are still being made as if this is temporary.

Budgets. Timelines. Feasibility assumptions.

If fuel resets quickly, fine.

If it doesn't, a lot of projects being approved today won't make sense six months from now.

We may be underwriting risk with last quarter's assumptions.