The fuel crisis in the communist nation of Vietnam may be worse than that of the United States. Gasoline stations all around Ho Chi Minh City, formerly Saigon, are suspending operations due to fuel shortages.
The closure of gas stations comes just over a week after Minister of Industry and Trade Nguyen Hong Dien claimed that Vietnam is not facing fuel shortages.
“The domestic fuel market has been stable, without any shortage, while prices are comparatively lower than elsewhere in the region,” he claimed. He added that Vietnam’s fuel stocks were sufficient to meet domestic demand until the end of November. (Related: America’s diesel fuel shortage could CRIPPLE the supply chain by Thanksgiving.)
Several days after Dien made this statement, Vietnamese officials pivoted by claiming that there is a concern relating to fuel supply but that this concern can immediately be alleviated by companies releasing their reserves of gas.
Dien himself made the appeal to the country’s largest energy companies, banking on the patriotic spirit of the private sector by stating how important stable fuel supplies are to national security. “Petroleum products are an indispensable source of energy for the country … and therefore, leading fuel trading firms have to keep the supply from being disrupted,” he said.
When this was reported on by VnExpress on Nov. 2, nearly 110 out of 550 gas stations in Ho Chi Minh City were experiencing fuel inventory concerns and the problem was starting to spread to other major cities like Hanoi and Haiphong.
Refineries asked to increase output amid worsening gas shortage
According to Nikkei Asia, hundreds of gas stations all over Ho Chi Minh City have been experiencing fuel supply problems since early October. This has forced many to temporarily suspend operations from time to time – a decision that occasionally affects surrounding cities in southern Vietnam.
Fuel supply concerns have even spread north to the capital of Hanoi, where residents are rushing to gas stations to fill up their tanks before the fuel shortages affect them.
“Another gas station was closed,” said Nam, a commuter attempting to refuel his motorcycle, the most common form of private transportation in cities. “Here, I at least got gas after waiting for 20 minutes.”
To resolve the fuel shortage, the government is calling on two of the country’s largest oil refineries to boost output to the maximum extent possible.
PetroVietnam, the country’s largest state-run oil company, responded by raising the output rate of its Dung Quat refinery in the central province of Quang Ngai from 107 percent to 109 percent. A refinery executive even stated that the output rate can be pushed to 100 percent or higher if the government asks for it.
The Nghi Son refinery in the northern province of Than Hoa is also increasing its output. This comes just months after the refinery’s operating rate fell, which is what caused the gasoline shortage in the first place.
The Dung Quat and Nghi Son refineries are able to meet a little over 70 percent of the domestic demand for fuel and other oil products. Most of the remaining demand is met by gas imports. In recent months, Vietnam has had more difficulty procuring foreign oil due to the sudden influx of European buyers who have unilaterally sworn of purchasing their oil and gas needs from Russia.
“[Now that] European countries are buying large amounts of petroleum products, a small country [like Vietnam] finds it hard to augment its purchases,” said one high-ranking official who spoke with Nikkei Asia.
The communist government is also looking to curtail gas demand by tightening regulations on the basis of protecting the environment and by supporting the proliferation of electric vehicles as part of the government’s drive to decarbonize – a move that could hamper the efforts of energy companies like PetroVietnam to expand their facilities and production capabilities.
Learn more about fuel supply problems all over the world at FuelSupply.news.
Watch this clip showing Chinese President Xi Jinping promising to help Vietnam build a “stable supply chain” amid fuel supply concerns.
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