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Ministries act to reduce retail price of petrol

Update: July, 29/2014 - 09:14
The Viet Nam National Petroleum Group (Petrolimex) reduced the petroleum RON 92 price by VND330 a litre to VND25,310 per litre, starting 2 pm on July 28. — Photo ndh.vn

HA NOI  (VNS) — The Viet Nam National Petroleum Group (Petrolimex) yesterday reduced the price of RON 92 gasoline by VND330 (1.6 US cents) to VND25,310 ($1.21) per litre.

The move followed a joint decision by the ministries of industry and trade and finance, which asked fuel dealers to cut retail prices.

This is the first time that the retail price of petrol has been reduced this year after five continuous increases. However, the decrease was modest as compared to the total increase of VND1,450 (7 cents).

The diesel selling price was lowered by VND350 to VND22,330 per litre ($1.05), becoming the second reduction within 10 days.

The price of kerosene was also reduced by VND350 per litre to VND22,460 ($1.07) while that of mazut remained unchanged at VND18,810 per kilo.

According to the ministries, retail prices were about VND275 (1.3 cents) lower than the base price, which is typically calculated as the import prices plus taxes, costs and profit quotas for fuel dealers.

With a previous subsidy of VND670 (3.2 cents) per litre from the price stabilisation fund, retail prices were about VND395 (1.9 cents) higher than the base price.

With falling world petrol prices, the ministries reduced the stabilisation fund subsidy level to VND600 (2.9 cents) per litre.

As retail prices of diesel and kerosene remained VND346 (1.6 cents) higher than the base price, authorities move to decrease prices yesterday.

Subsidies for mazut, a low quality fuel oil used in generating plants, were discontinued with retail prices sitting at VND26 (0.1 cent) per kilo lower than the base price.

Statistics from the Viet Nam Petroleum Association yesterday showed that fuel prices in the Singapore market – from where Viet Nam sources most of its fuel, had reduced significantly.

On Thursday, the price of petrol A92 was $115.6 a barrel, diesel was $118.5 a barrel, kerosene $118.81 a barrel while mazut was $597.87 per tonne.

The association said that after using the stabilisation fund, all items showed a profit.

On July 18, the two ministries asked fuel dealers to reduce retail prices of oil by VND136-174 (0.6-0.8 cents) a litre while not increasing petrol prices.

Under the Government's Decree 84/2009/ND-CP, traders can adjust petrol prices up to 7 per cent in line with world prices. — VNS

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