Power supply will meet the anticipated surge in demand during the dry season this year, said Dang Huy Cuong, director of the Electricity Regulatory Authority of Viet Nam.
|A worker of Thang Long Liquified Natural Gas Co in northern Hai Phong Port City fills cooking gas cylinders. Many domestic gas retailers raised their prices following an import tax increase. — VNA/VNS Photo Ha Thai|
Since April, world gas prices have dropped continuously. As a result, gas prices in the world market had dropped in early June by US$130 (or 15.2 per cent) over May to $722 per tonne.
The drop in world prices prompted the finance minister on June 20 to hike import tariffs on gas products from the current zero per cent to 5 per cent.
Immediately, many domestic gas retailers raised their prices by VND11,000 to about VND350,000 per 12kg cylinder.
Customers are angry about the rise in retail prices.
Trinh Van Khu of HCM City's Tan Binh District said gas traders now were still selling gas products they had paid no tariffs on so they should not be allowed to raise prices at this time.
"Even when they have to pay the import tariff of five per cent, they would still earn profits because the drop in world prices has been greater. Furthermore, they should not be allowed to increase retail prices by as much as VND11,000," Khu said.
In recent months, domestic gas retailers have made great profits because world prices have fallen sharply, but no corresponding cuts in retail prices were made, said District 5 resident Huynh Thanh Tuan.
Tuan said with the world prices at $722 per tonne, the domestic gas retail price should have been cut by VND32,700 per 12kg canister, but it dropped by only VND30,000.
This meant that gas retailers were already making a profit of at least VND2,700 per 12kg canister. And now, they would continue making bigger profits when they raised the price by VND11,000 per canister, he said.
According to independent market analysts, in March, gas retailers could earn about VND86,000 from a 12kg gas canister. In April and May, it was around VND50,000 and VND70,000 respectively.
This was reflected in the fact that gas traders announced significant profits in the first quarter of the year. The PetroVietnam Gas Corporation (PV Gas) posted after-tax profits of VND2.295 trillion ($110.23 million) in the first three months of the year, the analysts said.
Although the Government wants gas prices fixed by market principles, the ministries of finance and trade and industry should have proper price control mechanisms to protect consumers, they added