HANOI - Vietnam's Binh Son Refining and Petrochemical has cut output at its refinery for the second time in a month and could see operations suspended due to weak domestic fuel demand, a company source and state media said on Wednesday.

The 130,000-barrel-per-day refinery in central Vietnam has cut output to 80% of capacity, the Thanh Nien newspaper reported, after a reduction last month to 90% of capacity as a worsening coronavirus outbreak hurt demand.

A new wave of infections since late April saw Vietnam impose movement restrictions in a third of its cities and provinces and forced many companies to suspend operations.

"If the restrictions in the southern provinces continued into October, the refinery would probably have to suspend its production," the newspaper cited an unnamed executive of the company as saying.

The plant's refined fuel inventories have more than doubled from a month ago to 410,000 cubic metres, the executive was quoted as saying, adding that monthly sales have halved from pre-pandemic volumes to 300,000 cubic metres.

Binh Son has had to sell 1 million barrels of crude oil and is considering selling another 1 million barrels to free up its storage capacity, the report added.

Contacted by Reuters, a company source, who declined to be named because he was not authorised to speak to media, said: "We are operating at the lowest capacity possible and are seeking measures to keep our supply chain from being disrupted."

(Editing by Martin Petty)