Hanoi – Vietnam is considering a plan to scrap tariffs on fuel imports, the government said, as the US-Israeli war with Iran disrupts oil supplies and pushes prices to their highest level since 2022.
The ministry of finance said Sunday it had drafted a decree that would slash import tax rates to zero on some petroleum products to “help stabilise the domestic market and ensure national energy security”.
“If the conflict continues and the blockade of the Strait of Hormuz persists, alternative supplies on the international market will become scarce and risk driving prices up,” it said in a statement, referring to the waterway through which a fifth of global crude usually passes.
Since the war began more than a week ago with US and Israeli strikes on Iran, prices of fuel in Vietnam have risen sharply and the government has implemented emergency pricing protocols.
The cost of the most widely used grade of gasoline has risen 21 percent to 27,040 Vietnamese dong ($1.03) per litre — the highest since July 2022, state media reported. Diesel prices have surged more than 50 percent.
Vietnam currently imposes tariffs of 10 percent on unleaded gasoline and seven percent on diesel, aviation fuel and kerosene — all of which would be temporarily removed under the new decree.
Vietnam has so far avoided mass shortages and long fuel lines, but state media reported that dozens of smaller petrol stations have either temporarily closed or shortened their operating hours due to dwindling supplies.
Commuters, meanwhile, were feeling pinched at the pump, with some despairing of what a prolonged Middle East conflict could mean.
“The price is sky-high. My salary is still the same but the price of the gas is significantly going up,” said Le Quang, 25, a teacher living in Ho Chi Minh City.
“I think I will need to walk to work.”
According to the finance ministry’s proposal, which must be approved by the government, the tariff decree would be effective until the end of April.
The crisis in the Middle East has seen crude prices soar to nearly $120 a barrel, the highest since Russia’s invasion of Ukraine in early 2022.
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Source: AFP
