On 2 November 2022, The official Vietnam News Agency reported that some gas stations in Vietnam’s two biggest cities and adjoining districts have temporarily closed related that distributors have been unable to stand their rising costs due to the set gasoline prices by the Vietnamese government, according to industry sources. While the smaller distributors have been intensively affected, discouraging them from supplying owing to the shrunken profit. In addition, gas stations are temporarily closing because of the lack of refineries in the southern part of Vietnam, where Ho Chi Minh City is located and which is about 45% of the country’s demand for oil and petrochemical products.
According to the government-set prices, The commanded prices for oil products resulted in losses as the distributors still had to pay high prices on the international market. Currently, the companies are unable to maintain sufficient stocks. Minister Dien on Friday blamed fluctuations in the foreign exchange rate and difficulties faced by some fuel importers accessing credit from banks for the situation. But he said domestic refineries, which supply 70% to 80% of fuel needs, were running at full capacity.
The demand for petroleum in the region has increased amid a pandemic recovery, pushing demand to exceed supplies, resulting in shortages and higher prices. Even in Vietnam, where the economy continues to grow rapidly, gasoline demand is unlikely to significantly increase in the years to come, given tightening environmental regulations and the growing popularity of electric vehicles as the country heeds the global decarbonization drive.
Published 09/11/2022
By Ashley Jones
