Vietnam gas station closures raise concerns of fuel supply crunch

Vietnam gas station closures raise concerns of fuel supply crunch

HANOI: Some gas stations in Vietnam's two biggest cities and adjoining districts have shut or limited sales this week, witnesses and state media said on Tuesday, amid concerns about a fuel supply crunch spreading in the Southeast Asian country.

On Friday, the Minister of Industry and Trade Nguyen Hong Dien said Vietnam was not facing fuel shortages, seeking to calm fears after some petrol stations in southern cities cut or limited sales.

The official Vietnam News Agency reported on Tuesday that some gas stations in the country's business hub of Ho Chi Minh City had shut, or stopped selling gasoline, while maintaining diesel sales.

Meanwhile, National Voice of Vietnam radio reported that several gas stations in the capital Hanoi had shut.

Photographs on state media showed long queues of people on motorbikes at petrol stations in both cities.

It was not clear how many gas stations overall had been affected or the situation in most other areas.

On a highway linking Hanoi and Haiphong on Monday night, two petrol stations had limited gasoline sales to 400,000 dong ($16.11) per car, or around 17 litres.

The trade ministry did not immediately respond to a request for comment on Tuesday about the disruption.

Minister Dien on Friday blamed fluctuations in the foreign exchange rate and difficulties faced by some fuel importers accessing credit from banks for the situation. But he said domestic refineries, which supply 70% to 80% of fuel needs, were running at full capacity.

A Hanoi-based energy trader, who declined to be named because he was not authorised to speak to media, said low profit margins appeared to be discouraging retailers from keeping gas stations open because authorities had a cap on retail prices.

Vietnam's refined fuel imports in the first 10 months of 2022 rose 22.8% from a year earlier to 7.13 million tonnes, but costs rose 123.8% to $7.37 billion, according to official data.

"The demand for petroleum in the region has increased amid a pandemic recovery, pushing demand to exceed supplies, resulting in shortages and higher prices," Vietnam's top fuel importer Petrolimex said in a statement on Monday.

Petrolimex is still seeking to buy 8,500-8,900 tonnes of 10ppm sulphur gasoil in the market for prompt delivery between Nov 10 and 14 via a tender that should be awarded by Nov 1, two Southeast Asia-based traders said.

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