VietNamNet Bridge – Crude oil prices have plummeted recently, affecting revenue for state coffers, which depend heavily on oil and petroleum exports and imports. Prices dropped after Saudi Arabia lowered prices of exports to the US and the US oil reserves rose to 2.3 million barrels. International newswires reported that Saudi Arabia was kicking off a battle for larger oil market share. Economists, who believe the oil prices will continue to fall, have said the price fluctuations would affect Vietnam’s economy. A report from the Ministry of Finance (MOF) shows that revenue from oil exports and imports make up 26 percent of the state budget revenue in 2000 and 19 percent in 2012. MOF every year projects revenue from oil and its contribution to the state budget. If the world price is higher than expected, the revenue would be higher, and vice versa. Meanwhile, in order to obtain projected revenue in the context of oil price fluctuations, Vietnam would have to adjust the … [Read more...] about Lower crude oil prices to challenge Vietnam’s economy
Crude oil prices fall
VietNamNet Bridge – Oil & gas companies have seen their stock prices plummeting as oil prices have dropped. GAS, the shares of a gas company listed on the HCM City Stock Exchange (HOSE), has fallen by 31 percent from its peak of VND86,000 at the November trading session. PVD, the shares of a drilling company, lost 28 percent of its value, while PVS oil & gas service company lost 30 percent. PVS and PVC of the drilling solution and chemicals companies had led the HN Index of the Hanoi bourse to surpass the 93 point threshold, while GAS and PVD had led the HCM City bourse to the VN Index peak of 640 points in the past. However, the same shares led to a sharp fall in stock prices. It is still unclear if the stock prices have bottomed out. BIDV Securities Company has advised investors to invest in companies in the fields of transportation, plastics, tyre and packaging, and to “keep away” from oil and gas shares. SSI, Saigon Securities Incorporated, believes that … [Read more...] about Oil & gas shares fall as oil prices fall
VietNamNet Bridge – Economists have warned that the drop in the crude oil price will put pressure on the public debt, because the government will have to issue more bonds and increase borrowing. Dr. Tran Hoang Ngan, a member of the National Assembly’s Economics Committee, said Vietnam hopes to have revenue of VND85.2 trillion for the state budget from oil exports. Ngan said though the oil price fall will affect income, the state’s coffers will still be “safe” in 2014 as the earnings from oil exports in the first 10 months of the year was higher than what had been estimated. As for 2015, though anticipating oil price fluctuations, Dr. Ngan is still optimistic, saying that the gains will be bigger than the losses. The money Vietnam has to spend to import petroleum products is even bigger than the money it can earn from exporting crude oil. As such, if the oil price continues to fall, the lower prices of petroleum products will help enterprises cut their … [Read more...] about If crude oil prices fall, will the public debt go up?
VietNamNet Bridge – Vietnam could see a trade deficit in 2015 after three consecutive years of a surplus, as prices for crude oil, which Vietnam exports, have plummeted. The General Statistics Office (GSO) has reported that Vietnam’s import turnover in January was higher by $500 million than export turnover. Vietnam exported $12.9 billion worth of products and services in January. The figure, though representing an increase of 9.7 percent over the same period last year, was not high enough to prevent the trade deficit. Analysts noted that the return of the trade deficit was “foreseeable” and that the crude oil price decrease was an important cause. While turnover of other key export items have been increasing steadily (the export turnover of electronics and computer components increased by 62.2 percent, cashew nuts by 26.9 percent and footwear by 23.2 percent), crude oil export turnover in January dropped by 36.5 percent. Meanwhile, Vietnam imported $13.4 … [Read more...] about Trade deficit returns in the wake of lower crude oil prices
(VOVworld) - The World Bank has lowered its 2015 forecast for crude oil prices to 52 USD per barrel and 51 USD per barrel in 2016. The Bank experts said this was a result of slow global economic performance and high current oil inventories. They expected that Iranian oil exports will rise up to 3.6 million barrel a day after the lifting of international sanctions. The experts said they believed downside risks in world oil prices include higher-than-expected OPEC production and continuing falling costs along with improved productivity of the US shale oil industry. … [Read more...] about World Bank lowers 2015 crude oil price forecast