Petrol and oil price regulation principles in Vietnam

Petrol and oil price regulation principles in Vietnam (Internet image)

1. Petrol and oil price regulation principles in Vietnam

Petrol and oil price regulation principles in Vietnam are specified in Article 38 of Decree 83/2014/ND-CP (amended by Decree 95/2021/ND-CP) as follows:

- Petrol and oil prices shall follow market mechanism and be regulated by the State according to oil price changes in the world and current socio-economic developments.

- Major petrol and oil traders and petrol and oil distributors are entitled to decide the wholesaling prices. Major petrol and oil traders and petrol and oil distributors may decide retailing prices (except mazut which must be wholesaling prices) in their distribution systems according to actual costs incurred. Retailing prices must not exceed the regulated prices announced by competent authorities.

In an area that are far away from ports, major depots, petrol and oil production facilities, if the increase in actual (and audited) costs are legitimate and causes the selling prices to exceed the regulated prices, the major petrol and oil trader may decide the actual selling prices in such area (as notified to the Ministry of Industry and Trade) to cover the cost increase by up to 2% of the regulated prices announced at that time.

Major petrol and oil traders and petrol and oil distributors shall send selling price notifications to the Ministry of Industry and Trade and the Ministry of Finance immediately after their petrol and oil selling prices are decided.

- Petrol and oil price regulation dates

Petrol and oil regulation dates shall be the 1st, 11th and 21st every month. In case a price regulation date is on weekend or public holiday, it will be delayed to the working day succeeding the weekend or public holiday. A price regulation period that occurs during the Lunar new year period shall be delayed to the next price regulation period.

In case of unusual fluctuations in petrol and oil prices that have considerable impacts on socio-economic development and the people's life, the Ministry of Industry and Trade shall submit a report to the Prime Minister for considering and deciding the petrol and oil price regulation time.

- In case of fluctuations of price constituents that cause the base price to increase by more than 10%, or there are considerable fluctuations of petrol and oil prices that have considerable impacts on socio-economic development and the people's life, the Ministry of Industry and Trade shall submit a report to the Prime Minister for considering and deciding specific price regulation measures.

- Petrol and oil products whose base prices are announced by the State are commonly used petrol and oil products on the market.

2. Publicity and transparency in the petrol and oil price management and trading in Vietnam

- The Ministry of Industry and Trade of Vietnam shall assume the prime responsibility for, and coordinate with the Ministry of Finance in, managing prices in a public and transparent manner.

- The Ministry of Industry and Trade shall disclose on its website information about: global oil prices, base prices, regulated prices for petrol and oil products; time of application, contributions to and use of Price Stabilization Fund in petrol and oil price regulation periods; other measures (if any).

The Ministry of Finance and the Ministry of Industry and Trade shall disclose on their websites information about quarterly balance of the Petrol and Oil Price Stabilization Fund.

- Key traders shall publicize on their websites or in the mass media current retail prices; amounts set aside and used and balances of their petrol and oil price valorization funds on a monthly basis and before each adjustment of domestic petrol and oil prices; adjustment of price valorization fund setting aside and use levels; and publicize audited financial statements in the fiscal year.

(Article 38 of Decree 83/2014/ND-CP (amended by Decree 95/2021/ND-CP))

Diem My

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