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Increase of petroleum price does not affect inflation control

10:39 | 11/04/2018

VCN- It is said that the upward revision of petroleum will certainly affect the CPI in April. However, talking with Customs Newspaper, Dr. Nguyen Duc Do, Deputy Head of the Institute of Economics and Finance (Academy of Finance) affirms that the price of petroleum may not surge in the coming time and does not affect the inflation control target of  less than 4%  in this year.

increase of petroleum price does not affect inflation control Price management to avoid unreasonable price increases
increase of petroleum price does not affect inflation control Petroleum Price Stabilization Fund remains 5,222.545 billion VND
increase of petroleum price does not affect inflation control Petroleum Price Stabilization Fund remains over 3,975 billion VND
increase of petroleum price does not affect inflation control
Dr. Nguyen Duc Do, Deputy Head of the Institute of Economics and Finance

On April 7, the inter-ministries of Industry and Trade and Finance decided to revise the price of all petroleum products. Notably, the price of E5 RON92 petrol, was revised up to VND 592 per liter. How do you assess about this revision?

Over the past time, the world petroleum price has increased. The increase in domestic petroleum prices is in line with the context of the world price, thereby, the price increase is quite normal and not too concerning.

In your opinion, how does the increase of petroleum affect Vietnam economy this time, and in the coming time will it tend to surge?

In April, the increase of petroleum price will certainly affect the economy, especially CPI, but it will not affect the inflation control target of less than 4% in 2018.

Over the past time, the world price of petroleum has increased. Recently, the price has slightly decreased, thus in the next session, the domestic petroleum prices may decrease. The petroleum price is an unpredictable factor. Therefore, the prediction of increasing or reducing is also difficult. Currently, the world price is affected by the shale oil supply. If the petrol price sharply increases, the shale oil supply will increase, which hold back petrol prices. The petroleum price in each session may slight increase or decrease, but in this year, the petroleum price will not fluctuate, the market is relatively stable. The inflation control target of less than 4% this year is feasible.

increase of petroleum price does not affect inflation control Price management to avoid unreasonable price increases

VCN- The Ministry of Finance has just sent an official letter to the People's Committees of provinces ...

In 7th April, the inter-ministries of Industry and Trade and Finance decided to revise the price of all petroleum products, only recommended that traders increase price of RON 95 maximum VND 526 per lit compared to the current price but has not announced the basic price of this item. Many opinions stated that the basic price has not been announced, it will make RON 95 price push to higher and it will be difficult to control, and indirectly enforce consumers to use E5 RON92 petrol. What is your opinion?

In my opinion, the basic price of RON95 should be announced for people. For the story of E5 RON92 petrol consumption, there are many unspecified factors for comment. For example, whether or not the price of E5 RON92 petrol is cheaper but consuming more than RON 95 petrol? However, it is affirmed that if the State wants to encourage using E5 RON92 through price measures, it should be announced. Currently, the Vietnam petroleum market has not been a competitive one, there are units that fix the rate and dominate the market. At that time, the State has the role for the adjustment. The specific adjustment should be announced to people, because clarity and transparency is the most important.

Thank you Sir!

By Nguyen Thanh/Ngoc Loan