Since the beginning of the year, domestic gasoline prices have increased 16 times and decreased 9 times. Currently, each liter of RON 95 gasoline is at 23,040 VND; E5 RON 92 is 21,900 VND. This is the lowest level in nearly two months after a sharp decrease of 1,600-1,800 VND/liter in the operating session on October 11. However, according to energy experts, gasoline prices may increase by the end of the year.
Mr. Duong Duc Quang - Deputy General Director of Vietnam Commodity Exchange - said that in early September, Russia and Saudi Arabia - the two leading countries of the Organization of the Petroleum Exporting Countries and its allies (OPEC +) announced the extension of measures to tighten oil supply until the end of this year.
Saudi Arabia's announcement to maintain a production cut of 1 million barrels per day and Russia's export reduction of 300,000 barrels per day has kept the market in a deficit state in the third quarter of 2023. This is the main reason for pushing oil prices up, at times surpassing the $95/barrel mark in late September.
In addition, geopolitical instability in the Middle East in recent days continues to raise concerns about supply in the oil market.
Mr. Duong Duc Quang said that the oil market will continue to have a deficit in the fourth quarter of this year, when the OPEC+ group committed to maintaining the production restriction plan, while economic growth in major consuming countries such as the US and China is assessed to be more optimistic. This will still be the reason for pushing oil prices up again in the final period of the year.
However, the scenario of oil prices rising above $100/barrel in the fourth quarter is unlikely because high oil prices are motivating many countries to increase production. He cited that last week, US crude oil production increased to a record 13.2 million barrels/day, surpassing the peak in early 2020.
In addition, rising oil prices could also reduce demand. Western countries will also find it difficult to accept rising energy prices due to concerns about the impact on inflation control targets.
However, regarding the scenario of high oil prices at the end of the year, Mr. Quang is concerned about another risk, which is the complicated developments in the Middle East region.
"Although currently, regional tensions have not caused any impact on supply. But if the war spreads to the regional level, or involves many other important allied countries with power in the oil market, I think oil prices could completely increase. Therefore, the market needs to pay close attention to this factor," Mr. Duong Duc Quang shared.
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