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No additional petrol price cut at present
Vu Ngoc Hai, Chairman of Petrolimex, the biggest petrol importer and distributor in Vietnam, said that if the world’s oil price drops to below $80/barrel, and if importers are able to make profit, they would lower petrol sale prices by VND1,500-2,000/litre.
On October 11, 2008, crude oil with delivery in November dropped to $77.7/barrel, the same price as in September 2008. The sharp fall of the price of crude oil from $100.83/barrel on September 12 to $77.7/barrel on October 11 has made people cherish the hope that the petrol price will drop further for the fourth time since August 2008.
Most recently, petrol distributors announced the modest decrease of VND500 per litre of petrol.
Explaining the slight decrease, Hai from Petrolimex said that distributors still have to sell petrol at high prices to get money to compensate for the losses they incurred in the first months of the year, when they kept sale prices lower than import prices.
Petrol distributors imported a big volume of petrol before at high prices on the forecast that the oil price would surge to $200/barrel in the fourth quarter of the year.
When asked if petrol importers would reduce petrol prices in the time to come, if the oil price drops to below $80/barrel, Hai said that importers still have to wait to see if the government raises the import tax to decide whether to cut prices. Moreover, they also have to pay back the government the money it gave them before to help keep prices stable.
Under a newly released decision, importers have to pay back such support when oil prices go down and importers can make profit.
Hai said that if the oil price remains at $80-90/barrel, his company can make the profit of VND1,500-2,000/litre.
Hai has denied the fact that importers joined together to slash the petrol price by VND500/litre. Hai said that Petrolimex asked for the VND1,000/litre price decrease on both kerosene and petrol, but state management agencies accepted the small decrease of VND500/litre. Hai emphasised that management agencies make the decisions on whether to cut prices and by how much.
Nguyen Thanh Huong, Deputy Head of the Price Control Agency under the Ministry of Finance, in a recent interview with Tien phong newspaper, said that it’ll take enterprises six months to pay back the VND3tril they owe the state.
VNN
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