Petrolimex (PLX) and PVOIL Seek to Restrict Fuel Distributor Trading in Draft Decree

Overview

Petrolimex (HOSE: PLX) and PVOIL have proposed restricting fuel distributors from buying and selling petroleum products among themselves, according to a draft decree on petroleum trading discussed at a consultation meeting on 30/9. The two wholesalers, which together hold more than 70% of Vietnam’s petroleum market, favor tighter rules to reduce intermediary layers and prevent invoice-only trading. The outcome matters for PLX and OIL because it could reshape the distribution chain and the competitive position of the largest wholesalers.

Key Facts

• Petrolimex and PVOIL account for over 70% of Vietnam’s petroleum market share.
• The consultation meeting on the draft decree took place on 30/9, chaired by Trần Hữu Linh, Director of the Domestic Market Management and Development Department at the Ministry of Industry and Trade.
• The draft proposes merging retail agents, franchisees, and distributors into a single category called “distributors,” removing the current business-eligibility certificate requirement.
• Option 1 would restrict distributor-to-distributor trading, allowing it only in cases of supply assurance during market volatility, emergencies, natural disasters, or epidemics.
• Option 2 would permit such trading but require physical delivery, transfer of ownership, and traceability of each shipment.
• PVOIL Deputy General Director Hoàng Đình Tùng and a Petrolimex representative both leaned toward Option 1.
• Nguyễn Văn Tiu, Chairman of Tự Lực I Petroleum JSC, supported Option 2, citing stricter conditions in the draft.

What Happened

At a consultation conference on 30/9, Trần Hữu Linh of the Ministry of Industry and Trade said the government wants to redesign the petroleum distribution system to genuinely cut intermediary layers. He noted that the system built over the past 10-15 years has multiple layers, each adding costs and making the supply chain less efficient. The draft decree proposes consolidating retail agents, franchisees, and distributors into a single “distributor” category, which would no longer need to apply for a business-eligibility certificate as currently required.

The draft presents two options for how these distributors source goods. Option 1 restricts trading between distributors, permitting it only to ensure supply during market fluctuations, emergencies, natural disasters, or epidemics. Option 2 allows distributor-to-distributor transactions but mandates actual delivery, transfer of ownership, and traceability of each batch. Linh said there have been instances of distributors “trading invoices” while fuel remained in warehouses without physical movement, and the redesign aims to prevent “circular trading.” PVOIL and Petrolimex both favored Option 1, arguing that clear demand signals help wholesalers plan imports and domestic refinery purchases and take responsibility for supply. Some distributors, such as Tự Lực I, opposed the restriction, warning of supply disruptions.

Market Context

PLX closed at 35,600 on 30/9, while OIL closed at 13,300 on the same day. The draft decree is part of broader efforts to streamline Vietnam’s petroleum distribution sector, which has faced scrutiny over inefficiencies and intermediary costs. The proposal comes amid ongoing regulatory reforms in the energy sector, with the Ministry of Industry and Trade seeking to enhance transparency and supply chain resilience. The affected tickers trade on the HOSE exchange.

Strategic Significance

For long-term investors, the proposed restriction could strengthen the market position of dominant wholesalers like Petrolimex and PVOIL by reducing competition from smaller distributors and limiting circular trading that distorts demand signals. This may lead to more stable supply planning and potentially better margins for wholesalers, but it could also invite regulatory pushback if smaller distributors successfully argue that the rules harm competition and supply security. The final decree will determine whether the market consolidates further around the two largest players or maintains a more open trading environment.

What to Watch

• Finalization and official issuance of the draft decree by the Ministry of Industry and Trade.
• Feedback from other stakeholders, including the Vietnam Petroleum Association and smaller distributors.
• Petrolimex and PVOIL’s Q3 2026 earnings releases for any commentary on regulatory impact.
• Any amendments to the draft that incorporate distributor concerns about supply disruptions.
• Foreign-ownership and competition authority filings related to market concentration.