Fuel price climbs to new high, Finance Ministry wants to amend environment protection law
The Ministry of Industry and Trade (MOIT) and Ministry of Finance (MOF) have raised the ceiling fuel prices for the March 1 review. This is the third consecutive price increase in the Year of the Tiger.
The price of E5 RON 92 has increased by VND545 per liter and the selling price must not be higher than VND26,077 per liter. Meanwhile, the price of RON 95-III has increased by VND547 per liter and the ceiling price is VND26,834 per liter.
The prices of all oil products have also increased: VND469 per liter for kerosene to VND19,978, diesel VND509 per liter to VND21,310, and mazut VND536 per kilogram to VND18,468.
In the latest review, the inter-ministries decided to spend VND250 per liter for every liter of E5 petrol sold from the Petrol Price Stabilization Fund. The figures are VND220 per liter for RON95 and VND300 per liter for diesel.
According to MOIT, the developments of the world fuel market are complicated because of the Russia-Ukraine conflict. The fuel supply has been affected by the war, while the demand is increasing as countries are deploying measures to recover their economies.
The average fuel price between the February 21 and the March 1 reviews was $111.345 per barrel of RON92, used to make E5RON92, an increase of $3,083 per barrel, or 2.84 percent over the previous review. Meanwhile, the price was $114.207 per barrel for RON95, an increase of $3.559 per barrel, or 3.22 percent.
MOF has sent a document to ministries, branches and localities about the amendment of the laws, including the Article 6 of the Law on Environment Protection, the tax on non-agricultural land, the tax on agricultural land, personal income tax, natural resources tax and import and export tax.
Regarding the Law on Environment Protection, MOF asked to assess the outcomes of the implementation of the Law on Environment Protection No57/2010/QH12 which took effect on January 1, 2012, over the last 10 years (2012-2021).
The ministry asked to clarify if the law can help obtain the goals that had been set forth when formulating the law (help restrict the production and consumption of products and goods that cause environmental pollution; encourage the production and consumption of products and goods friendly to the environment…).
MOF also wants ministries, branches and localities to point out problems in the implementation of the law, and the reasons. Also, it has asked to suggest amendments of the articles of the law, if necessary.
MOF has asked the Ministry of Natural Resources and the Environment (MONRE) to join forces with ministries, branches and localities to assess the suitability of the current environmental protection tax rates so as to propose amendments of the tax rates.
The fuel price increases have put pressure on retailers’ businesses. A representative of MM Mega Market said the three-fold fuel price increase will affect transportation and packaging costs. International freight has also been affected by the fuel price hike. The input material prices have also increased, thus affecting production costs.
However, he said the retailer is negotiating with suppliers to stabilize prices.
Bui Trung Chinh from Aeon Vietnam said if the fuel prices keep escalating, this will affect input costs, especially seasonal products and fresh food.
However, he said the goods prices at his chain have been stable since Tet and Aeon has not received any proposal on price increases from suppliers. He said that there won’t be any sharp increases in prices of products as the retail chain will work with suppliers on stabilizing the prices.
As for Saigon Co-op, a representative of the retail chain said Saigon Co-op anticipated the situation, so it implemented a plan on storing goods after Tet and worked with suppliers to ensure stable prices.
The commitments on keeping prices stable have also been made by Winmart/Winmart+.
Deputy Director of the HCM City Department of Industry and Trade Nguyen Nguyen Phuong said the businesses joining the city’s stabilization program committed to keep prices stable one month before and after Tet holiday.
According to Global Petrol Prices, Vietnam’s petrol is the 65th lowest in the world. However, people complain that the prices are too high for the country with the average income per capita in accordance with PPP (purchasing power parity) of just $2,786.
If petrol and DO prices continue to stay high, transport firms may have to reduce services and routes, or stop operation temporarily.
On February 21, petrol prices set a new record after the Ministry of Industry and Trade and the Ministry of Finance decided to increase the price of all kinds of petrol and oil.