Macroeconomic targets were built with the presumed crude oil price at below $50 per barrel. However, the price has exceeded the $90 per barrel threshold, nearing $100.
After six times of raising the retail petrol price this year, the petrol price increased by VND2,650 per liter in total. The retail price exceeded VND22,000 for RON 95 petrol and nearly reached VND21,000 for E5 RON 92.
According to the Ministry of Industry and Trade (MOIT), RON 92 and diesel prices surpassed $90 per barrel and nearly reached $100, thus establishing a new price level in the last four years.
The General Statistics Office (GSO) believes that the petrol price hike will have impact on the CPI (consumer price index) in October and November.
Analysts warned that the macroeconomic indicators in 2018 set earlier this year may not be accurate as they were based on the low crude oil price of $50 per barrel. In reality, the price is nearly double.
The analysts said that the inflation rate would be below 4 percent this year following a series of government measures. However, the return of high inflation is inevitable as Vietnam cannot control the world crude oil price.
According to the National Finance Supervision Council (NFSC), the oil price fluctuations in the remaining months of the year will be one of the factors to affect the CPI.
In its latest report about the oil & gas sector, Ban Viet Securities also predicted an oil price increase with the average price of $80 per barrel in 2019.
The oil price rise in the world market and the appreciation of the dollar, according to economist Le Dang Doanh will be the biggest challenges for the national economy.
Meanwhile, Duong Manh Hung from GSO said the environmental protection tax rate may cause high inflation.
From January 1, 2019, a liter of petrol will have VND1,000 more, or VND4,000 in total, in environment tax.
“The petrol price and environment tax increases will surely influence the CPI and pull the GDP down because the production cost will be increasing and added value decreasing,” Hung warned.
The director of a clean food distribution chain in Hanoi said he has, for the first time in the last two years, informed his partners about the 10 percent price increases of his products from November.
The selling price increase aims to cover increased input material prices and production costs.
Transportation fees impact the petrol price increase, as petrol and diesel account for 40 percent of the transport cost.