The Ministry of Finance (MoF) has put forward the proposal to increase oil prices but keep petrol price unchanged in an attempt to stabilize the domestic market as the world oil price is standing high.
The proposal for the oil price hike stemmed from a fact that domestic traders, all State-run, are heavily suffering losses, the MoF’s Price Management Department said.
At present, oil trading firms are incurring a loss of VND2,155 on every liter of diesel oil sold, VND2,118 for kerosene and VND519 for fuel oil, it said.
“If there is any price rise, oil will be considered first,” an anonymous official of the MoF said.
“However, the rise will be acceptable and the Government will continue subsidizing sales of this product,” he added.
He said the scheme does not support raising the pump price of petrol as losses incurred from trading this product are small.
“They lose only some VND203 from sales of a liter of gasoline,” he added, explaining that “the loss from petrol sales can be compensated by profits oil trading firms earned previously.”
Kerosene and diesel oil prices are now VND7,900 a liter while a liter of A92 petrol now costs VND11,000 (US$0.7), A90 gasoline VND10,800 and A83 gasoline VND10,600.
However, the MoF confirmed to continue tracking global oil price movements to introduce suitable pricing mechanism soon, which is not entitled to oil trading firms.
The ministerial official also revealed that the MoF will resume import tax on distillated fuel, depending on categories, if the world oil price drops to under US$70 a barrel.
According to market experts, the oil price tendency is complicated in August as political tensions are escalating in some regions such as the Middle East and Nigeria.
Vietnam, the sixth largest crude oil producer in Asia, reported importing 6.82 million tons of petroleum products worth US$3.67 billion in the first seven months of this year, down 2.9 per cent in volume but up 29 per cent in value against the same period last year.
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