Fuel price cuts have no impact

Fuel price cuts have no impact

The prices of consumer goods and services remained the same in spite of the sharp cut in petrol and oil prices this year.

This week, and for the seventh time this year, the prices of petroleum and oil products were reduced, with petrol falling to VND22,890 per litre, a 10.7-per cent decrease compared with that in July.

When petrol prices were raised this year, numerous transport companies joined producers and suppliers of consumer goods in increasing their prices to offset the petrol price increase.

Vu Vinh Phu, chairman of the Ha Noi Supermarkets Association, said the petrol and oil price reduction would immediately impact on transport fees, which would, in turn, impact on the prices of consumer goods.

Phu noted that consumers were at a disadvantage now as transport fees and the prices of consumer goods remained the same.

However, transport companies gave various reasons for maintaining prices. Nguyen Van Thanh, chairman of the Viet Nam Automobile Transportation Association, said fuel costs accounted for roughly 40 to 50 per cent of transport fees, so the fees would be adjusted in accordance with fuel price fluctuations.

Thanh added that though petroleum and oil prices were reduced seven times this year, the cut each time was only for a small percentage, so transport companies were finding it difficult to immediately cut prices.

He remarked that after an increase or decrease in petrol and oil prices, transport companies needed more time to make the calculations that would serve as the basis for transport fee adjustments.

Taxi and passenger transport companies will also find it difficult to make any adjustments as they have to reprint tickets, adjust taxi metres and seek tax agencies' approval, Thanh added.

The companies can adjust prices if the petrol and oil price decrease or increase lasts for a long time, he noted.

Thai Van Chung, general secretary of the HCM City Transportation Association, said transport companies often increased their fees when petrol and oil prices rise by five per cent, so the reduction was often the same.

However, the reduction in petrol and oil prices this year was only roughly one to two per cent each time, so the decision to cut transport fees would depend on the transport companies, Chung added.

Since transport companies were maintaining their prices, producers and suppliers of consumer goods said they would likewise maintain theirs.

Meanwhile, the Ministry of Industry and Trade said it could not intervene, as the market mechanism was managing the prices of consumer goods and services except for electricity, water and petrol. 

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