Monthly Report | No.41.March 2026

Oil Crisis Adds Another Layer To Civilian Hardship in Arakan

Monitoring of a brief situation of political tension, economic, social, and humanitarian issues in Arakan in March 2026.

About report

This report is part of the CAS's monthly series, which delves into four key areas of the state of Arakan. The first section addresses political concerns, including the armed revolution, junta activities, and issues of political freedom. The second examines the state's economic climate, focusing on rising prices, declining demand, foreign direct investment, and border trade. The third and fourth sections cover social and humanitarian issues, respectively; these include education, health, migration, and the internally displaced persons (IDP) population.

Key data in the report are sourced from local media outlets, such as DMG, Western News, among others. The aim of this report is to shed new light on the situation for observers endeavoring to comprehend the dynamics at play in the region.

Executive Summary

The Arakan Army launched major offensives on strategic junta bases (No. 16 weapons factory, Nat Yay Kan, Dhanyawaddy naval base), inflicted heavy casualties, and seized territory. The junta responded with airstrikes, naval reinforcements, and artillery, but faced troop retreats, defections (35 troops in Kyaukphyu), and low morale. Post-election events saw Min Aung Hlaing elected vice president and the military reaffirm its political role, though the process lacks international legitimacy.

A severe fuel crisis caused prices to triple in junta-held Sittwe (40,000 kyats/liter) while AA areas remained relatively stable (8,000 kyats/liter). AA expanded economic regulation, taxing cargo routes, restricting medicine imports, and rescuing a sinking cargo boat. Cross-border trade faced seizures by Bangladesh Navy, armed robberies, and new Indian fuel restrictions, though Mizoram signaled willingness to cooperate with AA on the Kaladan Project.

ULA conducted child vaccination campaigns and launched the Arakan National University, while junta airstrikes disrupted education in regime-held townships (only more than 1,600 students sat for matriculation exams). A severe blood donor shortage emerged in AA areas. AA demonstrated religious tolerance by attending Muslim ceremonies and Eid celebrations. Public safety incidents included petrol pump fires, drownings (at least four deaths), and a house fire.

Junta airstrikes caused mass civilian casualties, including a horrific POW camp massacre in Ann (more than 116 killed, including two physicians). Landmines and ERW killed or injured civilians across multiple townships, with rising temperatures increasing explosion risks. Over 50 civilians were arrested in Sittwe, and IDPs faced acute shortages of water, food, and shelter in Kyaukphyu, Ponnagyun, and Rathedaung. Local diaspora and monastic networks provided critical relief, but international aid remains urgently needed.

Key Developments

A - Politics: Three Key Highlights

B - Economic Fall down: Three Key Highlights

C - Social Crisis: Three Key Highlights

D - Humanitarian Issue: Three Key Highlights

A - Politics and Armed Conflicts: Three Key Highlights

Intensified Clashes in Sittwe, Kyaukphyu, and AA Advances on Strategic Junta Bases

Heavy fighting erupted across multiple fronts, including Sittwe (15 locations on 7-Mar), Kyaukphyu (ongoing by 23-Mar), and the Rakhine-Magway border (Nat Yay Kan base from 11- Mar). AA inflicted significant casualties (e.g., 20 plus junta troops killed near Sittwe on 2-Mar; a captain and 20 others killed at Dhanyawaddy naval base on 6-Mar; a major and six troops killed on 29-Mar). Junta responded with airstrikes, naval reinforcements, and artillery but faced retreats (e.g., near DPA-16 on 30-Mar). AA also seized bunkers (18-Mar) and advanced on key positions, demonstrating growing battlefield dominance.

Junta Airstrikes, Civilian Harm, and Crimes Against Humanity Accusations

The State Security and Peace Commission (SSPC) conducted repeated airstrikes using jet fighters and Y-12 aircraft (Pauktaw on 7-Mar), bombed the Kacchapanadi Bridge in Kyauktaw (12-Mar), and struck a POW camp in Ann (11-Mar), which AA condemned as intentional atrocity. The junta also ordered the demolition of Muslim villages in Sittwe (30-Mar) as fighting escalated. AA responded by issuing curfews, defense strategies (8-point plan on 14-Mar), and warning residents of intensified airstrikes. These actions reinforced accusations of crimes against civilians and the use of terror tactics.

Post-Election Political Maneuvering and the Junta’s Legitimacy Push

Junta-controlled parliament convened on 16-Mar, with Khin Yi as Pyithu Hluttaw Speaker and Aung Lin Dway as Amyotha Hluttaw Speaker (18-Mar). Min Aung Hlaing and Nan Ni Ni Aye were elected vice presidents on 31-Mar. Junta leader reaffirmed the military's continued political role (28-Mar, Armed Forces Day), rejected exclusion of military from politics (16-Mar), and blamed ethnic armed groups for blocking peace. Despite claims of stability, the process faced widespread rejection as illegitimate.

General Overview

In March 2026, the Arakan Army (AA) intensified military operations across Arakan and adjacent borders, making tactical gains, capturing junta positions, and inflicting heavy casualties. AA also expanded governance functions such as taxation, landmine clearance, crime reporting, and issuing strict penalties for rape and drug offenses, while releasing hundreds of POWs to project legitimacy. The junta responded with airstrikes, naval reinforcements, forced conscription,...Read More

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