A representative of the Ministry of Industry and Trade (MoIT) has confirmed that Vietnam has a sufficient supply of fuel for local use and offers solutions if a shortage occurs in the market.
Tran Duy Dong, head of the Directorate for Market Surveillance under the MoIT, made the confirmation at a meeting on February 9 amidst concerns about fuel shortages in the country.
Over the past few days many petrol stations in several southern and central localities have suspended operations or cut working hours due to petrol A95 shortages.
Several fuel trading businesses expressed their concerns about a limited supply of petrol A95 after Nghi Son Oil Refinery and Petrochemical Plant, the largest of its kind that makes up one third of local demand, announced it had cut its production capacity since January due to financial problems.
At the meeting Dong assured Vietnam currently has between 1.8 and 2 million cubic metres of fuel to sufficiently meet local demand in February, but added supply may decrease in March as inventory is low compared to normal months.
However, The head of the market watchdog agency played down worries, saying Nghi Son Oil Refinery is scheduled to run at full capacity from mid-March and businesses are increasing imports that will help make up for the shortfall in supply from domestic production.
He also affirmed that the MoIT will increase inspections and strictly deal with violations of the market law of supply and demand, pointing out some petrol stations have shown signs of goods hoarding to create a serious shortage of fuel and manipulate the market.
He acknowledged fuel trading businesses’ proposal regarding market management and said MoIT Minister Nguyen Hong Dien would request the Prime Minister to permit the trade and finance inter-agencies to offer more flexible management tools.
Accordingly, State management agencies would, in limited supply conditions, be allowed to shorten the price adjustment time, use the national petroleum reserves if necessary, and increase the reserves in the long run.
Currently the Prime Minister allows the Ministry of Industry and Trade and the Ministry of Finance to work together to adjust domestic fuel prices every 10 days.
Deputy PM urged to stabilise gasoline supply
Deputy Prime Minister Le Van Thanh has asked the Ministry of Industry and Trade (MoIT) to promptly conduct inspections to prevent illegal hoarding of petrol for profit.
|Customers filing up at a petrol station in Hanoi. The Goverment has asked petroleum traders and distributors to ensure supply for domestic consumption. — VNA/VNS Photo|
The Deputy PM Thanh made the request at a meeting to discuss petroleum production and supply for the domestic market on Tuesday.
At the meeting, MoIT Deputy Minister Do Thang Hai said domestic gasoline supply meet 75 per cent of market demand; the remaining 25 per cent comes from imports.
Fuel retailers belonging to large-scale petroleum trading companies account for 90 per cent of the local market share. Fuel sales have been maintained continuously since before the Lunar New Year.
However, an unusual phenomenon has been reported as some petrol stations have stopped selling gasoline, citing supply shortages, leading to inspections by the MoIT and market management forces.
It is reported that most petrol stations ceased sales because they take petroleum from small-scale petroleum traders and distributors. Some have intentionally limited their sales, waiting for an increase in retail prices.
Ministries, agencies and petrol traders have confirmed that the supply shortage has only occurred locally at some petrol stations, due to the practice of hoarding petrol for profit.
Hai said that the MoIT has enough legal tools and policies to ensure the supply of petrol, as is required under the regulation on compulsory gasoline reserve for the key petrol and oil traders.
Hai also said that the immediate problem of Nghi Son Refinery and Petrochemical Plant was removed, and starting in mid-February, the plant would gradually restore its production to as it was before.
Also at the meeting, Deputy PM Thanh emphasised that gasoline is an important strategic reserve item that has a great impact on daily life and the national economy. Therefore, it must be well monitored and managed in a strict manner.
The country’s petroleum reserve is enough for market consumption. Vietnam has conducted legal policies to stabilise and meet the local market consumption.
The MoIT was asked to be more proactive in serving local market demand and work out more specific and accurate plans to ensure strict control of the petroleum market.
It was requested that a balance between petroleum production and imports be reached.
The relevant ministries and agencies are required to carefully review the current mechanisms and policies, and any shortcomings found must be amended promptly.
The HCM City People’s Committee has worked with agencies, petrol traders and distributors to discuss petrol supplies in the city.
At their working session, businesses reported that the fluctuations of the world petroleum market and geopolitical tensions in some countries have had a great impact on the domestic petroleum market, as demand has been gradually rising recently. In addition, the Nghi Son Refinery has stopped importing crude oil.
Phan Thi Thang, deputy chairwoman of HCM City People’s Committee, said the city would propose the Ministry of Industry and Trade and the Ministry of Finance to advise the Government on adjusting gasoline prices in special cases, so that businesses and major petroleum traders can take the initiative, while ensuring benefits for petroleum businesses.
Many private petrol stations in the Cuu Long (Mekong) Delta province of An Giang have run out of stocks and closed down temporarily, with some blaming it on hoarding by distributors who are waiting for the Government to increase prices.
An employee at Huong Duong petrol station in Chau Phu District, Nguyen Van Be, said they have been closed for two days due to a lack of supply.
Nguyen Van Viet, the owner of a petrol pump in Phu Tan District, said he had applied for permission from the local government to shut from February 5, because supply shortages have pushed wholesale prices up to the same levels as pump prices, causing him to lose money.
Nguyen Ngoc Thoi, director of An Kien Private Enterprise, a distributor to petrol stations in An Giang Province, said the latter used to earn VND200-1,000 per litre, but with supply scarce now and prices up, their profits have been wiped out.
He said with global petroleum prices increasing relentlessly, major suppliers are hoarding fuel and waiting for an upward price revision by the Government.
Tran Thanh Trung, deputy director of the An Giang Petroleum Company Limited (Petrolimex An Giang), said: “We only supply gasoline to our system and not to private gas stations because the supply is very limited.”
The situation has greatly affected businesses and transportation of people, especially as they start to return in huge numbers from the Mekong Delta region to HCM City and southern provinces to work and study after the Lunar New Year holidays.
A large number of petrol stations in several localities have suspended operations or have been forced to cut working hours over the past few days, reasoning that they have either faced losses or only received a limited supply of fuel.
According to the Ministry of Finance’s Price Management Department, domestic petroleum prices may go up in the next review as a result of price increases in the world market.