The ongoing energy crisis is affecting many countries worldwide, and Vietnam is no exception. According to the energy-focused publication Oil Price, the "nightmare" of soaring oil prices in Europe may worsen if tensions between Russia and Ukraine continue to escalate.

It's clear that the sensitivity of political factors has a huge impact on the trajectory of fossil fuel prices, revealing that excessive dependence can leave countries vulnerable in any situation.

Long Night of Woes

Immediately after the Lunar New Year of the Tiger, domestic consumers were shocked by the rapid rise in fuel prices. This "oil price shock" swelled the coffers of producing nations but increased costs for businesses and shrunk household budgets amid global supply chain disruptions, which will likely slow economic growth.

During and after the pandemic, the global economy, already shaken by slower growth and rising inflation, was further hit by the oil price shock. Bloomberg noted that this created a double whammy, making it difficult for governments to manage. For the first time since 2014, oil prices approached 100 USD per barrel. Previously, fuel prices had hit record highs over the past seven years. In 2021 alone, gasoline prices in Vietnam were adjusted upwards 16 times—more than triple the number of decreases. By the end of 2021, retail gasoline prices had increased by more than 41% compared to the end of 2020.

Over the past 40 years, the world has witnessed around nine energy crises. Whether prices rise or fall, each crisis is tied to political conflicts and economic recessions, severely affecting global financial stability.

The oil crisis of 1973-1975 caused a price spike and long lines of buyers; the Iranian Revolution and oil market fluctuations in 1979; the oil price slump of the 1980s; the oil price surge of 1990; the downturn in 2001; the severe oil price crisis of 2007-2008; and the oil shock of 2011.

In early 2022, rising fuel prices once again cast a shadow over the economy, pushing up inflation rates and eroding consumer confidence. According to The New York Times, political tensions and the imbalance between supply and demand are the main drivers behind the price hike.

A Maximum of 10 Gas Cylinders per Person. No more, even if you want to buy more!

Reducing Dependence and Committing to Green Growth Goals

Fossil fuels like oil, coal, and natural gas currently contribute more than 80% of the world’s energy supply. The current energy crisis has dealt a "crushing blow" to the already disrupted supply chains, pushing up costs and delaying shipments of raw materials and finished goods.

Vietnam is not immune to the current energy crisis, having become a net energy importer since 2015. Rising fuel prices will increase input costs for power plants that rely on imported fuel. This rise in electricity production costs will continue to put great pressure on EVN (Vietnam Electricity).

While the energy crisis may seem like a real "nightmare," renewable energy development is emerging as a hopeful dream. There is a need for a suitable strategy and investment plan for regional and cross-border transmission grids, consideration of energy storage technologies, and more.

The Lush Green Solar Power Plant at An Hảo Tourist Area Attracts Visitors

Whether wind or solar energy is harnessed or not, exploited minimally or maximally, it will never run out. Delaying its use would be a waste of nature's bounty.

The vibrant greenery around the solar power plant under Mount Cấm attracts tourists.

The current situation forces us to recognize that diversifying energy sources while continuing the transition to renewable energy is a wise and forward-thinking choice. This approach will help reduce dependence on depleting fossil fuels as demand continues to rise.

Reducing coal-fired power and increasing power from renewable sources is within reach of the Power Development Plan VIII.

Hải Yến