The Government Office has just issued an official dispatch conveying the opinion of Deputy Prime Minister Le Minh Khai requesting the Ministry of Industry and Trade to study the establishment of a petroleum exchange.
Regarding this issue, we had a discussion with economic expert Vu Vinh Phu - former Deputy Director of Hanoi Department of Industry and Trade - who has repeatedly proposed to the Ministry of Industry and Trade to establish a business exchange floor. Petroleum .
Dear Mr. Vu Vinh Phu, can you elaborate more on the proposal to establish a petroleum trading floor?
- For the petroleum market to operate openly and transparently, an exchange should be established. This will create a healthy market; Trading activities follow market principles, buying and selling is convenient, no one forces anyone, wherever is cheap and convenient, buy.
Wholesale and retail transaction prices are calculated by the business itself, with profits and losses borne. The ask-give mechanism no longer exists, there are no longer discounts, ceiling prices, and no base price.
Countries around the world are also doing it and Vietnam also has very effective trading floors such as coffee, rice, stocks, commodities... Establishing an exchange also helps agencies manage the quality of goods, manage pirated goods, pirated goods, counterfeit goods, poor quality goods, and floating petroleum goods.
In the context of the current petroleum market where there is still a state "monopoly", is it feasible to establish a petroleum trading floor and what should be kept in mind when establishing an exchange?
- When establishing an exchange, management agencies need to remove the ceiling price and floor price in trading activities. Regarding quality, price, and selling price, petroleum business units must take responsibility according to the provisions of law. They decide their prices based on daily, even hourly fluctuations in world prices.
At that time, consumers will benefit the most. The unit with the best selling price and good service attitude suitable for consumers will be chosen, otherwise consumers will be turned away.
Enterprises know how to calculate losses and profits when trading every drop of their gasoline according to the market. They have to know what to do to get customers to come to them. Except for special cases related to national defense and security, natural disasters, enemy attacks or overheating of the market, the State needs to intervene on prices.
In short, the State only needs to create a fair, open and transparent competitive environment along with applying science and technology to check the quality of goods and test measuring equipment. If violations are discovered, the fine will be heavy or the license will be revoked.
In addition, the State must strictly manage and strictly handle acts of smuggling, trade fraud, and petroleum fraud at sea and at the border. If these sources are allowed to leak in, it will be very harmful to the market and consumers.
So, according to you, when the floor is established, how will the national petroleum reserve be implemented?
- In my opinion, the State still needs to play the leading role and then assign it to an autonomous unit. At that time, the National Petroleum Reserve was a State-owned enterprise with legal status and transparent accounting.
However, this unit must be a special business unit, not like other normal business units. In addition to doing business, it must still perform the main task of ensuring reserves, ensuring National energy security.
Reserves also need to increase. In my opinion, it should at least be enough to last 3 to 6 months. The Ministry of Industry and Trade once reported to the National Assembly that the reserve is enough for 7 days. So when there are incidents such as natural disasters or wars, how can things change in time?
Enterprises only need to reserve according to their actual needs, rather than forcing them to meet storage and reserve needs as currently prescribed.
In addition, distribution businesses only need to reserve according to the actual needs of their production and business activities and are not required to ensure storage and reserves as currently prescribed.
- Thank you Sir!
