A consumer buys her canister of gas on November 30, one day before the gas price jumps in HCM City, saving VND80,000($4) in her pocket.— Photo Tuoitre.com

HA NOI (Biz Hub) — The large hike in gas prices beginning on December 1 has shocked many local consumers, while experts pointed to it as a sign of the existence of a monopoly.

Prices have increased by VND44,000 (US$2.2) since June, but following this most recent price hike, consumers must pay another VND80,000 (nearly $4) per canister (12 kg), making this the highest price since December last year.

Comparing different shops, the price for canisters is now listed between VND450,000($21.4) and 495,000($23.3) in the local market.

The price increase caused Pham Thi Minh from Ngoc Khanh Street, Ha Noi, to no longer order from her usual provider, since she now checks prices from other vendors.

"It is so unfair, I have nothing added to my retirement, yet prices of everything keep rising; first electricity and now gas, and it is just too much" said Minh. She has since ordered from a new gas shop because they offered her a reduction of VND50,000($2.5) on her first order.

In Da Nang City, Nguyen Thi Huong Lan, a worker, said the price increase was unexpected and too high for workers like herself, wondering whether she could save enough money to send some home to her parents.

While gas companies explained that the hike was due to rising gas prices throughout the world during December, yet experts suspected a different reason for the hike.

Among providers, Nguyen Thi Thanh Hong, deputy director of Sai Gon Gas Petrolimex Company, said one tonne of gas increased $267.5 on world markets in December, so there was no alternative but raising local prices.

However, economist Le Dang Doanh seemed not to be convinced with this explanation. He told Tuoi Tre newspaper that the gas market was not being operated transparently. Doanh suspected some local enterprises were holding their gas in storage, waiting for global price hikes to increase the price of their stored gas.

Meanwhile, Nguyen Ngoc Son from the University of Economics and Law in HCM City told the local press that in a market where most gas companies raise their prices to the same level, they can not be said to be operating in a competitive market.

According to Son, there were 30 major gas companies in Viet Nam which own different purchase contracts set at different prices. But on Sunday, these companies all posted their new increased price of VND78,000 or 79,000 (around $4) per canister, which made Son think there exists a collective monopoly.

While Doanh and Son said the Viet Nam Competition Authority should work to find the reason for the price hikes, deputy chairman Tran Van Thanh, on behalf of the Vietnam Gas Association, sent a request to the Ministry of Finance on November 28th asking for a reduction to zero per cent of the current five per cent tariff on gas products.

If the tariff is reduced to zero, a reduction of VND17,000($0.8) per canister could be passed along to the public. —VNS