Ho Chi Minh City, Vietnam – E-hailing driver Nguyen, who earns around 240,000 Vietnamese dong ($9.11) per day, found himself spending half of his earnings on fuel after a long shift. He told Al Jazeera, ‘I drove for around seven or eight hours and paid 120,000 Vietnamese dong ($4.56) on petrol.’ Nguyen, who works with the locally developed app Be, said, ‘I can’t survive with this amount of money in the city.’

Rising Fuel Prices Hit Hard

Vietnam sources about 80 percent of its crude oil from Kuwait, but shipments have dried up due to Iran’s effective blockade of the Strait of Hormuz, leading to a significant rise in fuel prices. Diesel prices have more than doubled, while petrol prices have increased by nearly 30 percent, according to Al Jazeera. Nguyen said, ‘Because the petrol price is so high, so many drivers are turning off the app, going home and just not working.’

After his recent experience, Nguyen said, ‘After today, I will turn off the app and stop working for a few days to see if the price goes down or if the government is helping in any way.’

Government Intervenes

Vietnam’s government has taken emergency measures to cushion the blow for citizens. Prime Minister Pham Minh Chinh announced that an environmental tax on diesel, petrol, and aviation fuel would be suspended until April 15 to help stabilise prices. Nguyen Khac Giang, a Vietnamese-born visiting fellow at the ISEAS-Yusof Ishak Institute in Singapore, said, ‘There are a lot of complaints and frustrations about rising living costs, because gas prices are everything in Vietnam.’

Giang added, ‘It’s not only necessary in terms of making the population feel relief about the rise of gas prices, but at the same time, it will keep the macroeconomic stability intact, given the turbulence outside Vietnam.’

Despite the government sacrificing an estimated $273 million in revenue via the tax cut, signs of strain are mounting across the economy. Public transportation is stretched to capacity in major cities, while domestic carriers such as Vietnam Airlines and Vietjet Air have slashed flights. Giang said, ‘As a very, very open economy, Vietnam is super vulnerable to international shocks.’

Gig Workers Face Double Whammy

Gig workers have been particularly exposed due to the double whammy of heavy fuel consumption and minimal labour protections. Do Hai Ha, a research fellow at the University of Melbourne, said, ‘Their income is changeable due to factors beyond their control. They have no chance to negotiate with the platforms.’

Many drivers have had no choice but to work longer hours as they are ‘excluded from labour protection, so there’s no guarantee in terms of minimum wages or overtime pay,’ Do said. Anh Dao, who collects fares on Ho Chi Minh City’s bus route 13, said the bus operator has been losing money due to the surge in fuel prices, despite raising ticket prices by 3,000 Vietnamese dong ($0.11). ‘As we already signed the contract, we cannot just stop running the buses,’ she told Al Jazeera.

For a fisherman in the coastal region of Binh Thuan, rising fuel costs have prompted a frantic search for cheaper options to power his basket boat. ‘Now that fuel prices are rising, it’s having a big impact,’ he said. The middlemen he does business with have been citing weak demand to justify offering lower prices for his catch. ‘What I was usually able to sell for 800,000 Vietnamese dong ($30) is now only selling for 650,000 Vietnamese dong ($24),’ he said.

For some low-income families, the rising costs are changing daily life in other ways. Uyen Pham, a communications manager for the Saigon Children’s Charity, said she has seen the strain firsthand. ‘Several parents noted that the cost of bottled cooking gas has nearly doubled,’ she told Al Jazeera. ‘Most of our beneficiary families have always relied on wood-fired stoves or a hybrid of wood and gas to save money. With the recent price hike, they are now strictly limiting their gas usage even further, relying almost entirely on wood to cut every possible expense.’

This pinches their take-home pay and, in some cases, reduces how often they can afford to travel home to see their children.’ For many parents, the rising fuel costs have also meant less time with family. ‘Many parents in remote areas must leave their children with grandparents to work in cities,’ Pham said. ‘Rising fuel prices directly increase their commuting costs, while manual labour wages remain stagnant.

For the government in Hanoi, the price volatility has intensified the focus on greater energy independence. Giang said, ‘The longer-term question this crisis has enacted is a very important question about the strategic autonomy of Vietnam in terms of energy dependencies, especially when we are a net importer of oil.’

Policymakers will need to ‘more aggressively accelerate Vietnam’s energy independence by building more refineries,’ Giang said, ‘because now we only have two refineries, which is not enough for the Vietnamese market.’

With long-term solutions likely to take years to come to fruition, authorities are scrambling for short-term fixes. Late last month, Vietnam’s prime minister and a delegation from the Ministry of Industry and Trade visited the Nghi Son Refinery and Petrochemical Complex, the country’s largest refinery, in Thanh Hoa. Officials said the refinery, which supplies about 40 percent of Vietnam’s petrol needs, would urgently need to find alternative sources of crude, as current supplies were expected to run out by the end of May.

The war on Iran also appears to be changing at least some domestic investment. Vingroup, Vietnam’s largest conglomerate, last month informed authorities that it wanted to halt plans to build the country’s largest liquefied gas-fired power plant and put the funds towards a renewable energy project instead, according to a letter reported by Bloomberg and Reuters news agencies. In the letter, the company cited ‘the significant risk of high fuel prices for LNG power projects’ due to the war.

In the meantime, Duy, who works at a cafe tucked behind a Ho Chi Minh City petrol station, is feeling some relief after the government’s fuel tax cut, which authorities projected would reduce petrol prices by about one-quarter and diesel prices by about 5 percent. ‘I usually pay 100,000 Vietnamese dong ($3.80) a week on gas, but at the peak of the high prices a few days ago, it was almost double that,’ she told Al Jazeera. ‘It affected my income.’