Although fuel import duties have been reinstated together with a retail price cut earlier this month, local fuel wholesalers are still pocketing huge profits from selling the commodities thanks to a steep decline in global prices.
Import duties on oil and petrol were increased to 7 percent from 3 percent starting June 8, one day after the Ministry of Finance cut retail fuel prices by VND600-800 a litre, reducing the gasoline price from VND22,700 to VND21,900 a litre.
Meanwhile, the A92 gasoline price in Singapore, the country’s mail fuel supplier, recently rebounded to only $105.6 a barrel on June 15, after slipping to somewhere between $101 and $102 a barrel, a $16 a barrel decline compared to a month earlier.
Calculations based on import prices from June 7 to now, plus the 7 percent import tariff, show that the petrol cost price is currently VND1,670 a litre lower than the retail price.
All of that difference will go to wholesalers’ pockets.
With calculations based on the average price within the last 30 days, the profit is also as high as VND700 a litre.
Fuel businesses said it is now completely feasible to impose a further cut for fuel retail prices, while also maintaining the interest of balance between the government, wholesalers, and consumers.