The Ministry of Industry and Trade is preparing a draft and submitting a decree amending and supplementing Decree 95/2021/ND-CP and Decree 83/2014/ND-CP on Trade in Petroleum and Oil to the Government for promulgation.
Accordingly, the management of gasoline and oil prices is also carried out on public holidays in order to avoid the situation of large price fluctuations that affect the interests of consumers or the petroleum and petroleum companies.
The fuel price adjustment cycle will be shortened from 10 to 7 days. Picture: Chinhphu.vn.
Accordingly, the operating time for gasoline and oil prices is every Thursday, excluding holidays (except in the event that the 1st, 2nd and 3rd day of the first lunar month of the Lunar New Year coincide).
If a Thursday falls between the 1st and 3rd lunar month, the operating period is shifted to the 4th day of the first lunar month. This differs significantly from the current regulations, when Decree 95 states that the holiday season without regulation of petrol prices and the Lunar New Year holidays will be postponed to the next period.
The reason for the Department of Industry and Trade’s choice of the above option is to ensure that petrol prices are more aligned with movements in petrol prices in the world market. Management is also carried out on public holidays to avoid price fluctuations during the holidays affecting the interests of consumers or oil companies.
If the prices of petroleum products experience abnormal fluctuations, which severely affect socio-economic development and people’s lives, the Interministerial Ministry of Industry, Trade and Finance submits a report to the Prime Minister for consideration and decides on the appropriate timing to fix gasoline prices.
According to the Ministry of Industry and Trade, the advantage of this option is that the domestic price of gasoline will fluctuate closer to fluctuations in the world price of gasoline. If prices rise, business support will be.
The process of importing petroleum from abroad to Vietnam (from the order to the arrival of the goods in the Vietnamese port) usually takes about 10-15 days. Therefore, when the market shows an unstable trend that is unfavorable to companies, companies will continue to have opinions about the short operating time/price announcement, which will affect the company’s business plan. It is difficult for companies to predict domestic prices when importing gasoline (especially when prices fall, which can happen, for example, after the end of the conflict between Russia and Ukraine).
In the draft report amending decrees, the Ministry of Industry and Trade also analyzed the pros and cons of changing the pricing formula and method of announcing the base price of petroleum products to give companies more autonomy.
The change is implemented in such a way that the state publishes only the price-forming elements, including the world market price (Platt price), taxes collected in the state budget, normalized profits, amount of funds used and expenses for using the fund, price stabilization, orientation for gasoline price calculation .
Companies rely on actual costs (including business expenses, transportation costs, premium…) to determine and announce the retail price of companies, to explain prices when prices change, and to report to the Department of Industry and Trade and the Department of Treasury Monitoring ( as with other price stabilization products within the meaning of the price law).
In addition, the draft regulation amends the instruction that gasoline and oil traders can buy gasoline from three gasoline and oil trading centers under gasoline and oil trading contracts, instead of buying from many sources as before.