Vietnam's largest fuel trader Petrolimex has announced an increase in gasoline prices, the third hike in just one month, even as experts called for measures to keep prices stable.
Prices of 92-RON gasoline, the most commonly used fuel in Vietnam, have been raised by 5 percent at VND23,000 (US$1.10), effective 5 p.m. Monday, news website VnExpress reported.
Diesel now retails at VND21,550 per liter and kerosene at VND21,450.
The hike came after economists said the government should reduce import duties on gasoline to save the public from suffering yet another price increase, warning that prices of consumer goods will surge after such a hike.
On Friday, a number of gasoline wholesalers proposed to the Ministry of Finance an increase of VND1,400 (6 cents) per liter of petrol, which was 6.3 percent higher than current prices.
Economist Le Dang Doanh told Tuoi Tre newspaper that further belt tightening caused by the increase in gasoline prices would hurt people.
"I think the proposed price increase of VND1,400 (6 cents) is too high and would be a big shock for public. This hike will probably lead to another hike in prices of goods," said Doanh.
While the Finance Ministry allows enterprises to raise gasoline prices, it should also reduce the current import taxes to keep the hike at reasonable levels, the economist said.
Each liter of petrol attracts 12 percent import tax, 10 percent value added tax, 10 percent special consumption tax and VND1,000 (5 cents) in environmental fees, said economist Ngo Tri Long.
All these taxes are putting too much pressure on gasoline prices, Long said.
The price of 92-RON gasoline increased on Friday from VND15,810 ($0.76) to VND16,750 ($0.80) per liter in Singapore, the standard market for retail prices of gasoline in Vietnam, said a wholesaler.