Dealers ask to raise petrol prices

The ministries of Finance and Trade are currently reviewing three proposals submitted earlier this week by petrol and oil traders to increase their retail prices to avoid losses.

The Military Petroleum Corporation (Mipec) proposed that the retail price should increase by VND750 per litre for petrol and VND1000 per litre for diesel oil and fuel oil.

The Petec Trading and Investment Corporation (Petec) proposed an increased of VND600 per litre for diesel oil and fuel oil.

The Vietnam National Petroleum Corporation (Petrolimex), which has 70 percent of the domestic petrol and oil market, submitted a proposal stating that prices should be increased, but did not indicate by how much.

The two ministries said that they are carefully considering the proposals and will base their decision on the developments in the world market and the effect on consumers.

The last increase in prices on June 10 saw one litre 0f A92 raised to VND13,000, a litre of kerosene to VND13,000 and diesel oil to VND10,000 a litre. 

In the past month in Singapore, which is the main supplier of petrol and oil product to the Vietnamese market raised prices from $74.84 to $74.98 per barrel of A92, from $73.76 to $76.79 per barrel of diesel oil and from $392.91 to $400.69 per barrel of fuel oil. At those prices, traders estimate losses of VND9,000 per litre of petrol and VND1,500-200 per litre of oil.

Since earlier of this year, the retail prices of petrol and oil have increased four times, or by a total of VND2,500 per litre, this is up by 22 percent as compared with prices at the end of last year.

The State has also cut the import tax rates on petrol and oil from 40 to 20 percent to help traders, and the Ministry of Finance temporarily stopped collecting contributions to allow petrol prices to stabilise fund in an effort to reduce the losses the traders were experiencing..

However, traders contend they still incurred losses despite these measures.

According to Petec’s calculations, the retail price of petrol would have to be set at VND15,500 per litre in order not to experience any losses.

A price that high would be a shock for consumers and might not help traders improve their current situation.

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