Key businesses can decide their own gasoline selling prices. The State only announces the 15-day average world price, as proposed by the Ministry of Industry and Trade.
The proposal was stated by the Ministry of Industry and Trade in the submission to the Government of a new draft decree, replacing previous decrees on petroleum business.
According to current regulations, the State sets a base price as a basis for operating retail gasoline prices. That is, the operating price announced by the State is like a ceiling price for businesses to determine their own retail prices in the system. For example, in the operating period on March 28, the State announced that RON 3 -III was 95 VND per liter, so businesses could not sell higher than this level.
However, in the drafting of the new decree, the Ministry of Industry and Trade proposed that the State not regulate gasoline prices, but announce the 15-day average world price and some fixed costs (foreign exchange rates, costs). business and enterprise profits, taxes and fees). Based on this data, key businesses will set their own maximum selling prices. The retail price to consumers cannot be higher than this maximum level.
"This regulation aims to reduce State intervention in deciding the selling price of businesses," the Ministry of Industry and Trade stated.
This agency believes that letting key businesses decide their own selling prices will help them compete on costs, eliminating the current application of divided gasoline prices in urban and rural areas.
In case the ratio of business costs and profits of an enterprise increases, the Ministry of Industry and Trade coordinates with the Ministry of Finance to report to the Prime Minister to consider making appropriate adjustments to reality. Adjustments are made every 15 days.
Previously, the proposal for businesses to independently determine gasoline selling prices was raised by experts in early 2023, when commenting on amending a number of articles of Decree 95 and 83 on petroleum business.
Gas station staff on Phan Xich Long street (HCMC) prepare to adjust gasoline prices, November 11. Image: Thanh Loc
Related to the Petroleum Price Stabilization Fund, according to the Ministry of Industry and Trade, there are opinions that the appropriation and use of this fund are not in accordance with the Price Law. Therefore, they proposed to build a new mechanism to replace current regulations, so that businesses can forecast and announce prices according to regulations.
"The new Decree will specifically regulate cases of deduction, expenditure and use of funds," the Ministry of Industry and Trade said.
There are currently many types of petroleum distribution systems, including wholesalers, distributors, retail agents, and franchises. According to the Ministry of Industry and Trade, the number of gasoline and oil distributors has increased rapidly in recent times, creating more sources of goods for retail businesses and diversifying the system, but there have also been shortcomings.
For example, regulations allowing distributors to buy from each other have made it difficult to control supply. In fact, the disruption of petroleum supply in 2022 shows that many petroleum distributors and traders trade in and out of petroleum, causing supply chaos.
Therefore, in this revision, the Ministry of Industry and Trade plans to tighten the management of the petroleum distribution system. In particular, distributors can only buy gasoline for wholesale investment, and cannot buy and sell with each other.
For retail businesses, the new draft proposes 3 forms, including gasoline retail agents for wholesale businesses or distributors; receive the right to retail gasoline or buy gasoline from wholesalers and distributors for retail sale at stores.
The Ministry of Industry and Trade also plans to tighten management of key enterprises. For example, they will have to ensure a total petroleum source of at least 100.000 m3/ton per year. This regulation aims to tighten the practice of many key traders being licensed, but not implementing or being given the privilege of not having to assign import quotas.
Focal points will have to connect business data and petroleum warehouses when renting warehouses with the Ministry of Industry and Trade. It is expected that they will have 24 months to prepare and implement this after the new decree takes effect.
