Price hikes fail to abate gasoline shortage

By Anh Minh, Thi Ha   November 14, 2022 | 08:52 pm PT
Price hikes fail to abate gasoline shortage
Long queues form at a fuel station on Pham Hung Street, Hanoi, November 4, 2022. Photo by VnExpress/Ngoc Thanh
Gasoline shortages continue to be reported in Hanoi and Ho Chi Minh City with retailers complaining that pump prices still do not fully reflect their costs.

Hanoi Grab motorbike driver Nguyen Ngoc Hoan had been waiting for 15 minutes at a filling station in Ha Dong District on Monday afternoon, but 10 others were still in front of him in the queue.

"I have been driving around for nearly 10 kilometers and this is my fourth gas station. The other three were either out of stock or had long queues."

In HCMC’s Thu Duc City, a gas station on National Highway 13 had no stocks since early morning, and its staff said delivery was slow.

The situation was similar at places in Go Vap, Tan Phu and Tan Binh districts.

Several other places in the country are also starting to report shortages.

In the northern coastal city of Hai Phong eight stations are seeking permission to shut down while seven others were asking to reduce their daily working hours to 10 from the current 24 hours.

Gas stations are low on or out of stocks in the northern provinces of Son La and Lao Cai, the central city of Da Nang, and the southern provinces of An Giang and Kien Giang.

Nguyen Van Tiu, CEO of fuel retailer Tu Luc 1, said supply remains limited though retail prices were increased on November 11.

His company earns a commission of zero to VND50 ($0.002) per liter, which means it is selling at a loss. The supplier is only able to provide small quantities.

Recently his stations have been typically running out of stocks within half a day or a day. So some limit sales to VND50,000 per motorbike and VND300,000 per car.

A CEO of a retail company with 10 gas stations in HCMC, who asked not be identified, said sourcing supply is extremely difficult.

"A supplier promised to deliver us 2,000 cubic meters this afternoon, but this will only allow each of our stations to sell for five or six hours."

Quoc Thang, a retailer with eight filling stations in Binh Duong Province, said: "We earn zero commission, and it is a real struggle to get enough gasoline to sell to consumers."

The Ministry of Finance last week agreed to factor in higher transportation costs for imported gasoline, allowing retail prices to be hiked for a fourth time in a row on November 11.

It said the costs were VND290-560 higher for a liter of gasoline, but retailers say the increase should be nearly double that amount for them to earn profits.

Bui Ngoc Bao, chairman of the Vietnam Petroleum Association, said suppliers are losing nearly VND1,000 per liter on imports since global costs have been rising.

"This is a matter that needs to be dealt with thoroughly soon."

The Ministry of Industry and Trade, which has been ordered by the government to immediately resolve the fuel shortage, has instructed suppliers and distributors to sign a commitment to ensure adequate supply for retailers.

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