VietNamNet Bridge - With the average price of crude oil at $32.4 per barrel, some subsidiaries of the Vietnam Oil and Gas Group (PetroVietnam) like PVEP and PVOil suffered losses in January 2016.

PetroVietnam officials said that if oil prices fall to below $30 per barrel, the group will halt or reduce oil output exploited at some oil wells.

At a meeting held by the Ministry of Industry and Trade in early February, PetroVietnam officials said falling oil prices in January continued to affect the group’s economic indicators.

Regarding production, the total output of oil in January 2016 reached 2.56 million tons, equal to 109.7% of the plan.  More specifically:

- The oil output of 1.57 million tons, equivalent to 107% of the targeted plan for January  

- The gas output reached 0.99 billion cubic meters, equal to 113.4% of the plan;

- Electricity production reached 1.73 billion kWh, equal to 89.2% of the plan;

- Production of gasoline reached 565.6 thousands of tons, equal to 114% of the plan.

However, because the average price of crude oil in January was only $32.4 per barrel, down $9.6 compared with the average price of December 2015 and down $17.8/barrel (equivalent to 35, 4%) over the same period of last year, the total revenue of the group reached only VND81.1 trillion, equivalent to 74% of the monthly plan.

Its contribution to the state budget reached VND6.2 trillion, equal to 72% of the plan.

According to Mr. Do Chi Thanh, Deputy General Director of PetroVietnam, due to the reduction of oil prices, many subsidiaries of PetroVietnam were also affected, especially firms specialising in oil and gas exploration.

Some subsidiaries such as the Oil and Gas Exploration and Exploitation Corporation (PVEP) and the Vietnam Oil Corporation (PVOil) incurred losses in January.

In February, the group is implementing various measures to deal with falling oil prices.

CafeBiz