2.

2 Factors that affect the demand of petroleum

Prior to the outbreak of the worldwide pandemic, demand for petroleum in

Vietnam was quickly expanding since gasoline and oil products are strategic necessary
fuels that have a direct influence on the operation of practically every field in the
country's national economy.

The demand for petroleum is greatly affected by the economic capacity of the
country. As Vietnam continues to develop steadily over the years, the demand for
petroleum has also increased since then.

Years
2005 2006 2007 2008 2009 2010 2011
Products

Gasoline 2.090 2.381 2.667 2.702 2.902 3.434 3.489

DO 3.797 4.146 4.618 4.992 5.451 5.833 6.558

FO 2.488 2.502 2.341 2.262 2.363 2.505 2.791

Kerosenne 382 334 324 318 310 295 419

Jet Fuel 506 487 496 501 520 536 698

Total domestic petroleum

9.263 9.850 10.446 10.775 11.546 12.917 13.954
consumption

EIA; Petrolimex - Vietnam National Petroleum Group, 2011

 But it was until 2020 when the petroleum industry took a hard hit as the
CoronaVirus spread widely and became a global pandemic putting every aspect of the
economy on restrain. The streets became empty as stores were forced to close and
people were put in quarantine. Many citizens are now working and studying in a new
format known as online schools and workplaces. And during the years when people are
working and studying at home, the demand for petroleum lowers as the requirement
for automobiles decreases. Mr. Nguyen Xuan Hung, Deputy General Director of the
Vietnam National Petroleum Group (Petrolimex), also highlighted that the business
situation of Petrolimex's petroleum products has significantly deteriorated. In particular,
the consumption volume of E5 RON92 gasoline and 0.05 percent DO oil is around 50%,
while RON95 gasoline is approximately 30% higher than the average for the same period
in June 2021. If localities extend the social separation period in accordance with
Directive 16, fuel consumption will continue to fall. On March 18, 2020, the price of
Brent oil fell "shockingly," merely hanging around the milestone. 24-25 USD per barrel.
With the present rate of drop of 7-8 percent per day, the global crude oil price may go
below $20 per barrel in the next few days. Domestically, as a result of the Covid-19
pandemic and the sharp reduction in oil prices, several companies and sectors of the
economy have faced significant challenges, particularly the Oil and Gas industry, a
critical economic sector. As a result of the low oil price and the Covid-19 outbreak,
consumption of refining and petrochemical products falls, the efficiency of oil and gas
extraction falls, and revenue is insufficient to pay and cover mining expenses.
 In addition to the pandemic, there is also another factor that affects the demand
of petroleum: the shift from petrol-fueled cars to electric ones that decrease the need
of oil and gasoline. Currently, there has been a competition in electric mobile
technology. The electrification race between car manufacturers and traders, as well as
the growing trend of using electric vehicles in many countries are having a significant
impact on the oil market.
Aside from cities and countries planning to develop electric vehicles and move to
restrict the use of cars with internal combustion engines in order to minimize emissions
and protect the environment... More and more countries, including China and India, the
world's two largest auto markets, are trying to create electric vehicles to be able to save
money and reduce reliance on oil imports.
 CONCLUSION
Through the study of petroleum, the topic has drawn the main conclusions:
- Petroleum is an essential commodity for production and social life, an important factor
in the cost of goods and services.
- Petroleum market depends on many factors: Politics, Economy, Population, Science
and Technology, Nature, Culture, State's macro management policies, supply, demand,
prices, competition, internal factors of the enterprise.
- Factors affecting the Demand and Supply of petroleum market in Vietnam.

Solutions to develop Vietnam's petroleum market

- Solutions to increase petroleum supply
• Speeding up the completion of domestic oil refineries to proactively source
domestic goods
• Strictly manage import and export of petroleum
- Solutions to increase gasoline demand
• Concentrating all resources to promote economic growth thereby rapidly
increasing demand for petroleum
• Improve people's income so that people can use more petroleum products
• Diversify petroleum products to meet the increasing demand of consumers
-Solutions to improve the petrol price mechanism
•Policy of tax
• Price policy
- Solutions to improve the competitiveness of enterprises
• Raise the awareness of accepting competition, considering competition is
inevitable
• Building commercial civilization in petroleum business
Reference:

Thị trường xăng dầu Việt Nam và các nhân tố ảnh hưởng đến sự phát triển (2015)

Ứng phó tác động kép từ dịch Covid-19 và giá dầu xuống thấp (2020) pvpower.vn

Vietnam2019 primary energy data EIA - Energy Information Administration