Vietnam News

Vietnam to continue facing difficulties securing fuel supplies

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Vietnam will continue to face difficulties securing refined petroleum products, its industry and trade minister said on Saturday, as authorities scramble to avert a fuel supply crunch.

Hundreds of petrol stations in Vietnam’s largest cities have shut or limited sales in recent weeks, citing financial difficulties and tight domestic supplies.

“Global supplies are getting tighter as countries are rushing to buy ahead of OPEC+ output cuts and further sanctions on Russia,” Nguyen Hong Dien told parliament.

Dien said dollar’s rise is making fuel imports more expensive, adding to the difficulties faced by importers. Vietnam’s dong currency has lost 8% against the dollar this year.

He said some fuel importers are also facing difficulties accessing bank loans to pay for their imports as they fail to meet banks’ requirements.

Vietnam’s central bank held emergency meetings this week with commercial banks to discuss liquidity in the system as lenders face pressure from tightening credit conditions and higher interest rates.

“Partial fuel disruption in the local market is threatening to continue at least until Nov. 11 when the finance ministry adjusts the costs for fuel importers,” Dien said.

He said Vietnam’s two refineries, with combined capacity of 330,000 barrels per day, supply 70% to 80% of the country’s fuel needs, but “they also rely on imported crude oil.”

Vietnam on Wednesday urged on its largest fuel trading firms to release stocks to ease concerns about a fuel supply crunch.

By Khanh Vu – Reuters – November 5, 2022

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