Vietnam Oil and Gas Group (PVN) has recently submitted their proposal to the Ministry of Industry and Trade, the Ministry of Finance and the Government Office on supporting domestic petroleum consumption by temporarily suspending petroleum imports.
One of the most remarkable recommendations is that PVN expects ministries to consider issuing policies to minimize/ temporarily ban the import of petroleum products that can be produced domestically during the complicated stage of the Covid-19 epidemic.
According to PVN, in Q1 / 2020, total petroleum consumption demand is estimated to decrease by about 30% and is expected to continue to decline when the whole market of tourism, services and transportation freezes. Inventories of petroleum products at Dung Quat and Nghi Son refineries are always at high level, especially gasoline products.
At some time, gasoline stocks were above 90%. PVNs refineries have been under pressure from both input (sale of inventory products) and output (customers cancel and expand time to receive goods due to very low demand).
As of March 30th, the product inventories of the two refineries exceeded the risk of exceeding the storage limit (except for DO oil). Specifically, the inventories of crude oil at Dung Quat and Nghi Son refineries are 384,256 m3 and 533,500 m3, with inventories rate of 76% and 64% respectively; gasoline inventories at Dung Quat oil refinery is 138,242 m3, accounting for 87%, at NSRP is 167,520 m3, accounting for 81%.
Although the demand for gasoline decreased and domestic petrol consumption was very difficult, according to the General Department of Customs, the total import volume of all types of petroleum in the first 2 months was 1,356 million tons. Compared with the total production volume of 2.16 million tons of the two refineries, the import volume accounted for 39% of the total domestic demand. The large amount of imports makes it difficult to consume domestically produced petroleum products.
Representative of the Ministry of Industry and Trade said the ministry is considering the proposal of PVN.