The retail prices of petrol and diesel products in Vietnam took a major downturn with decreases of VND800-3,110 per liter from 0.00 am July 11.

A filling station in Hanoi. File photo

Under the latest adjustment, prices of biofuel E5 - RON92 declined by VND3,110 to VND27,780 (US$1.19) per liter, and RON95-III by VND3,090 to VND29,670 ($1,27).

With such decreases, petrol prices have now moved under the VND30,000-mark per liter, equivalent to the mid-March prices.

Gasoline prices are usually adjusted every ten days at 3:00 p.m., but the inter-ministerial team of the Ministry of Industry and Trade and the Ministry of Finance had changed the time of the announcement to midnight to coincide with the entry into force of the new environmental protection tax rate on fuels and gas products from 12:00 a.m. on July 11.

Meanwhile, prices of diesel also decreased by VND3,020 to VND26,590 ($1.14) per liter, kerosene by VND26,340 ($1,13), down by VND2,010, and mazut fell to VND18,920 ($0.81) per kilogram or a decline of VND800.

This is also the first time after five price adjustment periods that the cross-functional team decided to deduct VND950 from the price per liter of fuels for the petrol price stabilization fund, along with VND550 per liter of diesel, VND800 for kerosene, and VND950 of mazut.

“This is necessary to build up the fund for the next price review period,” it added.

According to the inter-ministerial task force, petrol prices in the global market have been on the decline in the past ten days, mainly due to concern over the prospects of sanctions on oil supplies.

The grim economic outlook and the emergence of new Covid-19 variants are also seen as factors that may cause a slump in petrol demand in the coming time.

Since July 11, petrol and diesel prices have been subject to new environmental protection tax rates of VND1,000 and VND500 per liter, respectively, the lowest possible under current regulation.

The Standing Committee of the National Assembly previously decided to halve the environmental protection tax from April 1 until late 2022. However, given the surge in petrol prices in the global market, the authorities decided to further cut the tax to keep inflation under control.

In a recent Government meeting, Deputy Prime Minister Le Minh Khai requested the Ministry of Finance to consider other tax options to cut petrol prices, including the excise and value-added taxes in case prices in the international market continue the upward trend.

Since early 2022, retail petrol prices underwent 18 price adjustment periods with 13 increases and five decreases. Compared to late 2021, prices of RON95-III have gone up by VND6,380, E5-RON92 by VND5,230, and diesel by VND9,020.