VINACHEM

The average price of finished fuel products imported by wholesalers is now much lower than this time last year, but fuel retail prices are more exorbitant because of high import tariffs.

Over 70,700 tons of petrol worth more than US$67 million was imported in the first half of May. On average, the price of each ton of imported petrol was US$950, according to the General Department of Customs.

As of mid-May, petrol imports totaled nearly 880,000 tons, worth more than US$929 million. The five-month average import price was around US$1,056 per ton.

The average price year-on-year was much higher. Last year, the average petrol import price in the first half of May was US$1,113 per ton and the five-month price was US$1,126 a ton.

As for diesel oil, imports in the first half of May amounted to more than 131,000 tons, worth around US$112 million. By the middle of May, nearly 1.1 million tons of diesel oil had been imported, costing over US$1 billion.

The average prices in these two periods were US$853 and US$924 per ton respectively, versus US$980 and US$1,007 last year.

Yet, fuel retail prices moved in an opposite direction. Currently, each liter of A92 petrol sells for VND23,330 and diesel oil VND21,250.

This time last year, the two items were priced at VND23,300 and VND21,200 per liter respectively.

On May 23, 2012, the governing body issued a decision on reducing petrol retail price by VND600 and diesel oil VND400. As such, RON92 petrol and diesel oil prices dropped to a respective VND22,700 and VND21,200.

The main reason for this difference is import tariffs. The current import tax on petrol is 19%, while diesel oil is charged at 14%.

This time last year, import duties on gasoline and diesel oil were only 2% and 1% respectively, and then increased to 4% and 3% on May 23, 2012 in accordance with the above-mentioned decision.

With 19% import duty, each liter of petrol is bearing VND3,000 of tax. Plus excise tax, value added tax and environmental protection tax, one liter of gasoline is now subject to nearly VND8,000, said the Vietnam Petroleum Association (Vinpa).

Similarly, import tariff is occupying VND2,125 of the price of each diesel oil liter. Overall, taxes are making up nearly VND5,000 of diesel oil retail price.

This year, import tariffs on fuel have constantly been hiked, especially since April. On May 8, the Ministry of Finance decided to raise petrol import duty from 16% to 19% and diesel oil 12% to 14% when the global prices fell.

According to the statistics of the General Department of Customs, fuel imports in the first half of May as well as since January 1 are lower than the same period last year.

The total import volume of gasoline, diesel oil, kerosene, fuel oil and aviation fuel since the beginning of the year is more than 2.7 million tons, worth over US$2.5 billion, versus 3.3 million tons and US$3.4 billion year-on-year.