Gasoline price may increase by 500-700 VND/liter tomorrow

Petrol price today 5/20: Fear of economic recession causes oil prices to plummet

Oil prices fell sharply today due to concerns about a global recession. Recorded in the early morning of May 20, 2022, according to Vietnam time, price WTI . light sweet crude July delivery stood at 109.20 USD/barrel, down 0.69 USD/barrel during the session. However, if compared with the same time on May 19, the price of WTI oil delivered in July 2022 has increased to 3.39 USD/barrel.

While, Brent oil price July delivery stood at 111.61 USD/barrel, down 0.43 USD/barrel in the session but increased to 3.12 USD compared to the same time on 19/5.

Oil prices fell on May 20 in the context that the market recorded many indicators of a global economic recession, thereby negatively affecting energy consumption needs, including crude oil.

In a report released earlier this week, strategists at Morgan Stanley raised their forecast for a US recession in the next 12 months to 27%, much higher than the 5% forecast made last month. March 2022.

US economic growth in the first quarter of 2022 fell 1.4%, the first contraction of the country since 2020.

In the latest development, the United Nations on May 18 lowered its forecast for global economic growth in 2022 from 4% to 3.1%. This United Nations forecast is based on the decline of major economies such as the US, China and the European Union.

Oil prices fell today due to concerns that global inflation is unlikely to be controlled in the short term and the decision to raise interest rates by central banks will further slow down the process. global economic recovery.

In addition, information about the EU’s difficulty in reaching a consensus on imposing an embargo on Russian crude oil and giving the green light for the purchase of Russian gas also put pressure on oil prices to go down.

Previously, oil prices rose continuously in the morning session of May 19, showing the market’s erratic behavior during a period of mixed news. The July WTI oil contract (code CLM) is a contract with a superior trading volume compared to other contracts, because today (May 20) will be the last trading day of the June contract. In the coming months, investors can still maintain their fundamental analysis of the trend, but the support and resistance levels will change quite a bit due to the nature of the forward contract. For WTI July, resistance is at $113/barrel and the nearest support is still at $100/bbl. The price has a rising trendline since the beginning of the year and will appear a very strong support if the price returns to the area of ​​100 USD/barrel.

According to the Vietnam Commodity Exchange, the scenario that the oil price can drop deeply to 100 USD is unlikely to happen in at least the next week, because the information on the market is more inclined to “bullish”. promote)”. The current drop in oil prices is mainly due to the lack of strength to break above important technical resistances, and not to any particular change in the balance of supply and demand in the medium and long term. Falling oil inventories in the US, gasoline prices still anchored at high levels, along with the possibility that the EU will approve a ban on Russian oil imports this May are supporting factors for oil prices. Oil prices will soon start to rise again.

On the other hand, the story revolves around China’s “zero Covid” policy, the longer it is, the more “bearish” to the market. After some positive news, the market receives worse news about the epidemic in this country. Therefore, the market will only really react positively when China completely lifts blockade orders at major economic centers and seaports. If it is still only at the level of statements, plans or expectations, the market will ignore this information.

In fact, in recent days, the topic of US and global economic outlook is attracting more attention and attention. Of course, this outlook will be tied to the trend of oil and fuel prices of all economies, all production activities. Ignoring the supply-demand factor, which is unlikely to have a breakthrough, macroeconomic indicators along with US monetary policy are likely to have a significant impact on oil prices in the next few weeks. In addition, the strength or weakness of the Dollar will also have a negative effect on oil prices. With the current news, it seems that the fear is more overwhelming and this will be the main “bearish” information for the market in the near future.

With a balance between buying and selling dynamics, experts believe that oil prices will continue to witness alternate sessions of ups and downs and only trades in the range of $104-$110/barrel for monthly WTI oil. 7 and around 106 – 112 USD/barrel for July Brent oil today and tomorrow.

Domestically, gasoline prices may increase for the 4th time in a row. According to the focal company, the price of gasoline tomorrow may increase by 500-700 VND/liter, bringing the gasoline price above the mark of 30,000 VND/liter, if the operator does not deduct the stabilization fund.

According to regulations, tomorrow (May 21) is the time to adjust domestic gasoline and oil prices. Data from the Ministry of Industry and Trade shows that retail gasoline prices on the Singapore market updated to May 17 increased sharply compared to the previous price calculation period. Specifically, the price of RON 92 gasoline used to prepare E5 RON 92 gasoline has an average price of 146.3 USD/barrel. And RON 95 gasoline is 150.3 USD/barrel.

According to petroleum enterprises, the average price of imported gasoline in this cycle increased by about 5-6% compared to the previous cycle. Due to high import prices, petroleum businesses are losing about VND 1,000-1,100 with gasoline.

Therefore, in this operating period, if the management agency does not Petroleum price stabilization fund the price of gasoline may increase by 600-700 VND/liter, surpassing the milestone of 30,000 VND/liter, the record high so far; and oil prices are likely to remain the same or decrease slightly.

In case the management agency reduces the setting up or increases the expenditure of the Stabilization Fund, the domestic gasoline price may increase less. However, experts are not inclined to this option because the stabilization fund at enterprises is negative, so this operating period, the management agency is likely not to deduct the Fund with gasoline.

If the forecast is true, the domestic gasoline price will increase for the 4th time in a row.

In just 2 months, the retail price of gasoline in the country has peaked twice. Most recently, on May 11, each liter of RON95 gasoline increased to VND 29,980, the highest in history. Gasoline prices are close to 30,000 VND/liter and may increase further if world prices are still on an upward trend, which will affect consumption, economic recovery and inflation. If gasoline prices increase by 10%, inflation will increase by 0.36 percentage points and growth by 0.5 percentage points.

With the current increase, experts commented, the average gasoline price will increase quite high, directly affecting transportation, fishing and consumption. The operator needs to review and recalculate the cost levels in the base price structure of gasoline and taxes and fees to control the increase of this fuel.

Petrol price today 5/20: The domestic retail price of gasoline on May 20 is as follows: E5 RON 92 gasoline does not exceed VND 28,959/liter; gasoline RON 95 not exceeding 29,988 VND/liter; diesel oil not exceeding 26,650 VND/liter; kerosene not exceeding 25,168 VND/liter and fuel oil not exceeding 21,560 VND/kg.

The above price has been adjusted up at the price management period of the Ministry of Finance – Industry and Trade on 11/5 with gasoline price increased by more than 1,400 VND/liter, oil price increased by more than 1,000 VND/liter, and fuel oil price kept unchanged. original.

This is the third consecutive increase of domestic gasoline prices.