Fossil Fuel Crisis and Clean Energy Development Dream

9:31:51 AM | 2/21/2022

The energy crisis is seen in many countries around the world, including Vietnam. According to the energy site Oil Pricem, the nightmare of oil shocks in Europe is likely to get worse if Russia-Ukraine tensions continue to escalate.

Obviously, political sensitivity has a significant influence on fossil fuels, showing that excessive dependence will result in passive responses in all situations.

Time is a woe

Shortly after the Lunar New Year or Tet, domestic consumers were shocked by rapid hikes in gasoline prices. Oil price shocks inflate the budget revenue for oil producers but increase production costs for enterprises and shrink the pocket of consumers amid a troubled global supply chain. Economic growth will be certainly dragged down.

The global economy is wobbling due to slowing growth and rising inflation in the context of the Covid-19 epidemic outbreak, the oil price shock has dealt a double blow and made it difficult for governments to manage, according to Bloomberg. For the first time since 2014, world oil prices approached the threshold of US$100 a barrel. Before that, gasoline price topped 7-year highs. In 2021, gasoline prices in Vietnam increased 16 times, more than trebling reductions. By the end of 2021, the retail gasoline price was more than 41% higher than the end of 2020.

Oil price shocks are partly obsessed by supply shortages. Photo: Getty Images

Over the past 40 years, the world has witnessed nine energy crises. No matter it rose or fell, each crisis was coupled with political strife and economic recession, which seriously affected global finance.

The 1973-1975 oil crisis caused prices to skyrocket and forced buyers to queue in long lines, followed by the oil market turmoil in the wake of the Iranian Revolution in 1979, oil price plummets in the 1980s, oil price surges in 1990, oil price slumps in 2001, the severe oil price crisis in 2007 - 2008 and oil shocks in 2011.

In early 2022, escalating gasoline prices have overshadowed the economy, resulting in inflation and eroding consumer confidence. According to the New York Times, political tensions and supply-demand disparity gave rise to oil price hikes.

Only at most 10 gallons of gasoline. You can’t buy more

Avoiding dependence and persisting with green growth goals

Fossil fuels such as oil, coal and gas currently account for more than 80% of the world's energy. This energy crisis has dealt another deadly blow to supply chain disruptions, driven up costs, and delayed orders for raw materials and finished products.

Vietnam cannot stand aside from the current energy crisis when it has switched to become a net energy importer since 2015. Therefore, the increase in fuel prices leads to higher input costs for power plants that use imported fuel. Rising electricity production costs will continue to put great pressure on EVN.

If the energy crisis is a real nightmare, renewable energy development is a sweet dream. Because it is necessary to have a suitable strategy and investment plan for inter-regional and inter-national transmission grids and review energy storage technologies.

Eye-catching green in An Hao Solar Park and Tourist Area draws many tourists

Wind power and solar power never run out no matter how they are tapped, much or little or none, but it is a waste to delay tapping this godsend.

Green batteries in the solar park at the foot of Nui Cam Mountain

What is happening makes us see that diversifying our supply and shifting to renewable energy is a wise and visionary choice to reduce dependence on fossil energy sources that are increasingly depleted amid a constantly increasing demand.

Reducing the share of coal power and increasing renewable electricity is a story within the reach of Power Plan VIII.

By Hai Yen, Vietnam Business Forum