The Vietnamese government demands no petroleum price hikes until June of 2008 in order to curb the country’s surging inflation rate, Prime Minister Nguyen Tan Dung said at a meeting march 23 with Vietnam National Petroleum Corporation (Petrolimex) and 10 other petrol importers.
“Petroleum is a national strategic commodity traded under market mechanisms but under the Government's regulation,” Dung stressed at the meeting. “Petrol trading businesses have to manage supply and demand and be able to increase the reserves under any circumstance,” he added.
Dung demanded giving the priority bringing inflation down to a lower rate than last year. Until June this year, the petroleum import tax would be kept at zero per cent, the Prime Minister said.
The government agreed to compensate importers for losses, and provide assistance to poor people in remote areas and offshore fishermen who are facing difficulties, Dung attributed.
The government leader asked the Ministry of Industry and Trade to cooperate with the Finance Ministry and the State Bank to regulate the petrol trading nationwide to ensure enough supply for production and daily life.
The Finance Ministry was asked to increase revenue from the export of crude oil to compensate for losses in petrol imports. The compensation was estimated at VND1,000 billion ($62.5 million) per month. The ministry agreed to pay VND8,000 billion (US$500 million) in compensation to petrol trading enterprises for 2007.
The State Bank of Vietnam must ask commercial banks to provide major petrol importers with loans in foreign currencies to facilitate their trading activities.
The prime minister requested the Finance Ministry and relevant agencies to consider Petrolimex's project to ensuring a supply of petrol in 2008, and to set up a fund to “stabilize petrol prices" and other measures to manage Vietnam's petrol trading.
Later last month, local petroleum traders decided to raise the retail prices of the fuel by VND1,500 per liter of gasoline to VND14,500 for A92 and VND14,800 for A95; and by VND3,700 per liter of oil, in the awake of the global oil price soar to over $100 per barrel. (Local sources)
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