After fuel tax relief measures, Vietnam needs a policy to shape a long-term energy strategy.

Against the backdrop of global energy markets facing complex geopolitical shocks, Vietnam has implemented unprecedented adjustments to the fuel price structure to stabilize the market. To understand the impact of these policies and the long-term outlook for national energy security, the Vietnam Economic Journal/VnEconomy interviewed Le Nguyen Thien Nga, Director of the Institute of Policy Management and Strategy Development, on this issue.

Consecutive gasoline and diesel tax cuts: timely response, but temporary

The decision to sharply reduce fuel taxes, flexibly adjust VAT and excise taxes, and advance 8 trillion dong from the budget to the Price Stabilization Fund is described as a decisive and timely policy response to the global energy geopolitical shock. The interviewee said the move is a breakthrough in that, for the first time, the tax components that make up the price of gasoline and oil were cut simultaneously within a special window (from March 26 to April 15, 2026).

According to the Institute of Policy Management and Strategy Development, these measures have significantly reduced the pass-through of international price shocks into the domestic economy. Domestic fuel prices fell about 5–10% compared with a no-intervention scenario, while inflationary pressures in Q1 2026 declined by about 0.2–0.3 percentage points.

However, the interviewee emphasized that tax relief is only a short-term instrument. Based on OECD and IMF experience, price-support measures should be temporary; if prolonged, they can place heavy pressure on the budget, distort market signals by reducing incentives to conserve energy, and delay long-term structural solutions. The focus now should be on building a coherent set of solutions aligned with the National Energy Strategy and improving the economy’s resilience to energy volatility.

Market sentiment and distribution effects

As a pressure-relief valve, the fiscal relief policy is expected to stabilize market expectations. Without state intervention, the market could enter a psychology of continually rising prices, leading to hoarding, speculation, and local supply disruptions.

The tax relief is also described as sending a signal that the state is willing to share the cost burden. Benefits are expected to flow through refining and distribution by reducing working capital pressure and mitigating losses when import prices rise. Transport and logistics enterprises may see lower input fuel costs, easing pressure on freight rates. Households may benefit through lower travel costs and reduced pass-through effects on essential goods.

At the same time, the interviewee noted that benefits may not be evenly distributed and could be captured by intermediaries in the chain. For that reason, the tax policy is being implemented alongside enhanced market monitoring and competition regulation.

What households and businesses should change

To create substantive impact consistent with Conclusion 14-KL/TW on ensuring fuel supply and pricing, relying on the state alone is not considered sufficient. The report cited by the interviewee shows that Vietnam’s energy intensity remains 1.3–1.5 times higher than OECD countries, indicating room for efficiency gains.

For households, the suggested direction is to shift from habitual consumption to energy-conscious consumption, including reducing use of fuel-inefficient vehicles, increasing use of public transport, prioritizing energy-efficient appliances, and gradually transitioning to electric or hybrid vehicles.

For the broader system, the interviewee outlined three pillars of energy governance: (i) optimizing existing resources through technology, improving energy recovery and energy storage; (ii) digitalizing the energy value chain across the entire process, with governance based on data and forecasting; and (iii) cross-sector energy integration, operating oil, gas, electricity and green energy as a unified system to minimize costs and reduce volatility.

The interviewee added that every 1% energy savings across the economy can help reduce CPI pressure by 0.1–0.15 percentage points, framing behavioral changes as both environmentally beneficial and a macroeconomic tool.

International context and strategy after tax relief ends

The interviewee said Vietnam’s policies should not be assessed solely through domestic economic lenses. Oil prices are influenced not only by supply and demand but also by geopolitical competition among OPEC, the United States, and Middle East hotspots.

Vietnam’s move is aligned with a global trend of using fiscal pressure-relief approaches. The Institute cited IEA and IMF views that countries respond differently depending on fiscal space: Thailand, Norway, Germany and Korea reduce fuel and energy taxes and sometimes provide direct electricity bill subsidies; Italy and Spain roll out large fiscal packages to subsidize fuels and support transport firms; the United States releases strategic petroleum reserves and considers state-level tax relief measures; and France remains more cautious, warning that tax relief without supply controls could spur demand and push inflation higher.

From this trend, the Institute recommends a future Strategy Architecture Framework to prepare for the period immediately after tax relief ends. The recommendations include strengthening domestic supply autonomy, expanding strategic reserves, and investing in refining and energy technologies.

Energy-intensive industries: pressure to adopt technology

For energy-intensive industries such as cement and steel, the interviewee said the pressure to accelerate technology adoption is strong. Cement, steel and chemicals account for 50–60% of industrial energy consumption. When energy prices are high, optimization is described as a prerequisite for survival and growth.

The interviewee linked the current price environment to a restructuring effect: price pressures can act as a natural screening mechanism, forcing the economy to restructure, reduce emissions, and shift to greener energy. Investments in new technologies can help firms reduce energy costs by 10–20%.

Vietnam’s energy system and self-sufficiency constraints

The cement and steel transformation is described as dependent on the broader national energy system. Vietnam has an upstream-downstream energy structure: major oil fields such as Bach Ho, Dai Hung, Su Tu Den, Su Tu Trang, Rong, and Te Giac Trang serve as upstream sources. Downstream, strategic refineries such as Dung Quat and Nghi Son meet about 70–75% of domestic fuel demand, but still rely on imported crude—highlighting the need to strengthen self-reliance and innovation across the national system.

The interviewee said the core issue is not whether to transform, but the degree of technology mastery and the speed of deployment.

Energy-security milestones and technology priorities

The interviewee cited several energy-security milestones. Upstream, the revival of the Dai Hung field demonstrates national capability with cumulative revenue above USD 4 billion. Key technologies such as the central processing platform and offshore mooring system were said to set national records. Downstream, Dung Quat’s ability to produce specialty fuels is described as signaling self-reliance across production to commercialization, contributing to national energy security and defense in a complex geopolitical environment.

In a world facing geopolitical volatility, supply-chain disruption and sanctions risk, the interviewee said there is a need for national energy R&D strategies and publication of scientific energy works to extend scale and upgrade competitiveness. Agencies and enterprises are described as actively implementing resolutions that place energy science and technology at the center of national development strategy, promoting technology innovation in enterprises, and building and positioning a national brand in energy to enhance the role and voice of Vietnamese firms in international markets.