The sharp drop in oil prices affects which industries?

The impact of the US reciprocal tax has caused world crude oil prices and domestic gasoline prices to drop sharply last week. According to the announcement of the Ministry of Industry and Trade at 3:00 p.m. on April 10, gasoline prices continued to decrease by a large margin, specifically: RON95-III gasoline decreased by VND1,710/liter, E5 gasoline decreased by VND1,490/liter, DO-II and DO-V oil decreased by VND1,230/liter.

With this price reduction, the manufacturing and transportation businesses will benefit. This will contribute significantly to Vietnam's growth according to the Government's target of over 8%. Besides, people are also the ones who benefit when gasoline prices drop sharply.

Which industries benefit when world oil prices plummet?

Chairman of the Vietnam Petroleum Association Bui Ngoc Bao said: Vietnam is a net importer of 65-70% of petroleum, so when world oil prices drop to a low level, it is always beneficial for Vietnam, beneficial for promoting production and developing the economy.

According to MB Securities Joint Stock Company, fuel costs account for a large proportion of the cost of goods sold in some industries, so the impact of falling oil prices will help transport businesses expand their profit margins.

Similar to asphalt, the price of asphalt raw materials has decreased, helping to significantly reduce the cost of capital of asphalt businesses. The decrease in gas prices following oil prices will positively impact the profit margins of chemical and fertilizer businesses.

Indirect benefits also help the cement, auto steel, spare parts, food industries... increase profits, save production costs, and reduce transportation costs.

Profits of petroleum businesses decline

The total minimum petroleum source in 2025 allocated by the Ministry of Industry and Trade to key enterprises in 2025 is 29,500,000 m3/ton. Of which, Petrolimex is the enterprise with the largest allocation of 11,939,000 m3/ton. With the average price reduction of petroleum products today being 1,460 VND/liter and the number of days of inventory in circulation according to regulations being 20 days, Petrolimex is estimated to lose thousands of billions of VND.

Limited business results in the first quarter of petroleum businesses along with economic difficulties due to instability from the world trade war. 2025 is forecast to be a year of many difficulties and challenges for petroleum businesses.

Oil refineries have been hit hard, too. Binh Son Refining and Petrochemical Joint Stock Company (BSR) is forecast to see double-digit declines in its first-quarter 2025 profit as crack spreads for gasoline, diesel and jet fuel in Asia have fallen 13%, 7% and 18% year-to-date, respectively.

Soon amend Decree 83/2014/ND-CP

According to forecasts by many experts and organizations, in the context of investors increasingly concerned about the risk of economic recession due to escalating trade tensions between the US and other countries, especially China, oil prices will continue to fall. Since April 2, when US President Donald Trump announced plans to impose reciprocal tariffs on all imported goods, the prices of two benchmark oil products, Brent and WTI, have lost nearly 17%; compared to the average price of 2024, Brent prices have decreased by 21.3% and WTI by 21.4%.

Goldman Sachs predicts Brent and WTI will reach $62/barrel and $58/barrel, respectively, by December 2025. A year later, prices could fall to $55/barrel and $51/barrel, respectively, under a number of different scenarios.

For petroleum businesses, the decline in oil prices is not necessarily good news. Profit margins are under pressure from the delay in the price adjustment cycle, making it difficult for revenue to increase immediately. In particular, with the current price mechanism as stipulated in Decree 83/2014/ND-CP, according to Mr. Bui Ngoc Bao, the issue of handling price mechanisms, price management mechanisms, and inter-connected reserves stipulated in the Decree has a strong impact on the financial activities and efficiency of businesses.

For this reason, Vietnam needs to promptly implement the construction of a national petroleum reserve system instead of assigning petroleum trading enterprises to carry out petroleum reserves. At the same time, a new Decree is needed to replace Decree 83/2014/ND-CP to ensure that petroleum trading enterprises are protected from fluctuations in market prices.

Source: https://baochinhphu.vn/gia-xang-dau-giam-sau-tac-dong-den-nganh-nao-102250410174003421.htm