Surrounded by difficulties, Petrolimex faces additional tariff challenges

In 2024, Petrolimex faced many difficulties due to major fluctuations in the oil market. World oil prices fluctuated strongly, affected by factors such as war, embargo policies and global consumption demand, which directly impacted the business operations of enterprises in the industry. The Group faced pressure to reduce profit margins, while still maintaining stable supply and service quality.

In addition, domestic gasoline prices are greatly affected by input factors, environmental fees and operating costs, making cost management more difficult than ever. However, thanks to the flexibility and determination of the leadership team and staff, Petrolimex has implemented many measures to optimize production and distribution processes, minimize costs and maximize benefits from core business activities. As a result, the Group has maintained stable growth despite many market difficulties.

In the first 4 months of 2025, Petrolimex achieved an output of 5.7 million m³/ton, completing 33% of the plan and ensuring the set progress. The Group's revenue reached VND 86.6 trillion, reaching 35% of the plan. At the same time, Petrolimex paid VND 9,100 billion to the state budget, reaching 34% of the plan, also exceeding the set target. However, consolidated pre-tax profit reached VND 113 billion, reaching 4% of the plan.

Looking at the market in the first 4 months of 2025, the global oil market has never faced such great uncertainties. In particular, US President Donald Trump's policy of promoting domestic oil production and imposing reciprocal taxes on more than 180 economies has weakened the oil market. A major shock in April 2025 when OPEC+ unexpectedly increased oil production, combined with US reciprocal taxes, especially the 46% tax imposed on Vietnam, caused crude oil prices to plummet from 71.71 USD/barrel to 55.12 USD/barrel in just one week.

Member of Board of Directors, Deputy General Director of Petrolimex Tran Ngoc Nam.

Responding to shareholder Nguyen Thi Hoang Giang's question about the unfavorable fluctuations in oil prices in the first months of the year as well as the announcement of reciprocal tariffs by US President Donald Trump on April 2, which affected Petrolimex's production and business results, Petrolimex Deputy General Director Tran Ngoc Nam said that since US President Donald Trump announced the plan to impose reciprocal tariffs on all imported goods on April 2, the world's oil prices have decreased very quickly, from 75 USD/barrel of Brent oil before to just over 60 USD/barrel after a few days. According to Petrolimex's calculations, the largest decrease at one point was over 20%.

Meanwhile, according to current state regulations, wholesale traders must maintain a minimum inventory of 20 days. In addition, the Ministry of Industry and Trade also allocates total resources to wholesale traders such as Petrolimex while the management of gasoline prices is carried out on a weekly basis.

Therefore, with deep and very rapid fluctuations in just a few days while the inventory according to Petrolimex's regulations is equivalent to about 750 thousand m3 of gasoline, Petrolimex's business activities are seriously affected.

According to Mr. Tran Ngoc Nam, in the operating period on April 10 alone, Petrolimex lost 1 trillion VND in revenue, and with the inventory in the adjustment period on April 17, Petrolimex lost another 300 billion VND. When the selling price drops sharply but the cost of goods purchased high before are still in inventory, it will affect Petrolimex's business results in the core petroleum business in the first quarter of 2025.

With the current sharp drop in oil prices, combined with complex geopolitical fluctuations in the world, Petrolimex and many other oil traders realize that 2025 is a year with many risks and is very difficult to control for oil business activities.

However, Petrolimex affirmed that it will continue to closely monitor the situation and publish the financial report for the first quarter of 2025 at the end of April so that shareholders can better understand the level of impact and solutions to cope with it. At the same time, to overcome the difficulties, the Group has also had many important strategic solutions suitable to the practical situation.

Streamlining and restructuring the apparatus according to Resolution 18-NQ/TW

The Group has established a Steering Committee to review the implementation of Resolution 18 of the Party to promote restructuring and streamlining the organizational apparatus. One of the important steps is to merge units that have completed their historical missions in the recent period into the parent company, complete the divestment of some subsidiaries and terminate the operation of representative offices that are no longer suitable. These changes not only help reduce management costs but also enhance the effectiveness of governance, creating a solid foundation for sustainable development.

Petrolimex Chairman of the Board of Directors Pham Van Thanh spoke at the Congress.

Speaking at the 2025 Shareholders' Meeting, Petrolimex Chairman Pham Van Thanh affirmed that for Petrolimex, the policy of merging provinces and cities is an opportunity to expand the retail network, when intra-provincial, inter-regional and inter-provincial routes will be strongly implemented. However, this process also affects the organizational structure and the psychology of workers.

As soon as the policy was issued, the Group established a Steering Committee, held meetings with unit leaders, consulted with experts and international models to develop a new organizational plan suitable for a system of only more than 30 provinces and cities. The goal is to be lean, efficient, reduce costs and ensure smooth operations.

In addition, the Group has also decided to restructure and divest from some member units, terminate the representative office in Cambodia and Ho Chi Minh City, and merge PTC Corporation into the Group. The shareholders' meeting on March 28 also agreed to continue restructuring the parent company and member units. This restructuring process is expected to bring positive results.

Digital transformation and application of modern technology

Sharing about digital transformation - an important solution to improve the Group's business efficiency, Petrolimex General Director Doan Nam Hai said: "Our view is that digital transformation is one of the important, breakthrough solutions to improve production and business efficiency, increase customer experience and optimize system-wide operations."

Petrolimex carries out digital transformation in conjunction with the strategy of developing sustainable and smart energy in line with the orientation of Resolution 57-NQ/TW on innovation and Resolution 55-NQ/TW on national energy development. The Group has built a digital transformation strategy until 2030, with a vision to 2045, in which high technology is integrated into all areas of operation from sales, logistics to internal management.

Petrolimex General Director Dao Nam Hai.

In 2023 and 2024, Petrolimex has successfully implemented many key projects. Typically, the application of electronic invoices for each sale is a breakthrough in enhancing transparency, risk management and improving customer experience. At the same time, the Group promotes automation at warehouses and gas stations, develops a cashless payment system integrating RFID technology and smart cameras, applies the SMO order management system, BI smart reporting, expands digital offices and effectively exploits software systems such as SAP-ERP, EGAS, PLXID and mobile applications.

In the period 2025-2030, the Group is preparing to synchronously deploy modern technologies and further automate operations and controls. Some of the contents being promoted include: installing automatic level gauges at storage tanks, screening pump columns at petrol stations, researching solutions to prevent mistaken import of petrol, applying tank truck bottom loading technology and testing Coriolis principle meters in road shipments. The Group is also preparing to deploy an automatic payment system at 100 petrol stations with a large number of customers in major cities such as Hanoi, Hai Phong, Da Nang, Nha Trang, Ho Chi Minh City and Can Tho - aiming to build a model of smart, modern petrol stations.

In particular, artificial intelligence (AI) is one of the key areas that the Group is focusing on developing. “We have organized mandatory AI application training courses for all staff, from managers to employees, to improve labor productivity and technology adaptability. Assign specific tasks to the Digital Transformation and Information Technology Department to research and deploy AI applications in four key areas: optimizing inventory and logistics; analyzing consumer behavior to personalize services; monitoring quality and managing risks; and especially simulating the market, supporting oil price forecasting and planning resource generation according to different scenarios,” Mr. Hai emphasized.

With a comprehensive digital transformation strategy and proactive application of modern technology, Petrolimex believes it will continue to maintain its role as a leading enterprise in the industry, while creating sustainable value for shareholders, customers and the whole society in the digital age.

Green energy transition

Identifying green energy transition as a vital factor for the future. According to Chairman of the Board of Directors Pham Van Thanh, in the next 15 years, petroleum will still play a very important role. However, the trend of transitioning to green, clean and sustainable energy is irreversible.

To date, 142 countries have committed to carbon neutrality – including Vietnam. At the COP26 Conference, the Vietnamese Government pledged to achieve net zero emissions by 2050. This is a strong commitment and demonstrates our international responsibility.

Around the world, many large energy corporations have also developed a roadmap for transformation. However, in the past three years, this trend has encountered many difficulties. Large corporations such as Chevron, ExxonMobil, Shell... have had to adjust their investment plans in renewable energy. For example, some units have cut their investment from 5 billion USD/year in clean energy to only 1.5-2 billion USD. The main reason is pressure from shareholders - when these investments have not brought about clear economic efficiency, even causing losses. Shareholders require businesses to focus again on traditional fields to ensure profits.

At the government level, some countries have also changed their policies. For example, the new US administration has called for increased fossil fuel production to ensure energy security and reduce price pressures. At COP29, the representative of Saudi Arabia frankly stated that the country would not commit to cutting oil production. Poland – a member of the EU – is also struggling due to its heavy dependence on coal, causing conflicts in Europe's green transition roadmap.

In that context, Vietnam also needs to make appropriate adjustments. At a recent conference of the Steering Committee to amend Resolution 55-NQ/TW dated February 11, 2020 on the National Energy Development Strategy to 2030, with a vision to 2045, many experts proposed reviewing and updating the content of the resolution to suit the new trend - both ensuring international commitments and meeting domestic realities.

Petrolimex is implementing solutions to protect the environment, reduce emissions and develop renewable energy products. The Group has begun to use biofuels and is looking for opportunities to cooperate with international partners to invest in green energy technology. According to the Group's leaders, the green transition not only meets the global trend but is also part of Petrolimex's commitment to sustainable development. However, this cannot be done too quickly, but must be done while observing to avoid getting stuck like other corporations around the world. "Depending on the situation, we will move quickly or slowly according to the green - clean developments of the world, ensuring maximum profit for shareholders" - the head of Petrolimex Group emphasized.

Concrete actions and commitment to long-term development

To realize the strategic objectives, Petrolimex has also identified a number of specific actions. The Group will continue to review and adjust the distribution network, improve operational processes and manage costs more effectively. In particular, the Group will focus on improving customer service quality through new technology applications, enhancing communication with customers through online channels and expanding convenient payment methods.

In addition, Petrolimex is also committed to increasing investment in human resource training and developing a team of cadres and employees to meet the Group's sustainable development needs. The Group's leaders affirmed: "These solutions will not only help us overcome difficulties but also create a foundation for Petrolimex to continue to develop more strongly, not only in the region but also globally."

The 2025 Petrolimex Shareholders’ Meeting clearly demonstrated the Group’s determination and continuous efforts to overcome challenges, while also providing clear strategies for sustainable development in the future. With a spirit of solidarity and creativity, Petrolimex is gradually building a solid foundation to cope with fluctuations in the petroleum market, while ensuring long-term benefits for shareholders and the community.

Source: https://daibieunhandan.vn/dai-hoi-co-dong-petrolimex-2025-no-luc-vuot-kho-va-chien-luoc-phat-trien-ben-vung-trong-boi-canh-thach-thuc-toan-cau-post411527.html