Oil prices will see dramatic increases next week, according to industry players.
Based on the initial calculation of the oil companies, the price of diesel will increase from 0.50 pesos to 0.60 pesos per liter; and the kerosene will rise from 0.60 P to 0.70 P per liter.
For gasoline-based products, depending on the oscillation of market forces, the cost increase may be as low as 0.05 to 0.10 P per liter. It is possible that the oil companies will choose not to implement this meager price adjustment.
Philippine oil companies are expected to apply the new prices at the pump on Tuesday, August 31. The rate will mainly be anchored on cost movements linked to the Mean of Platts Singapore (MOPS), a regional price reference since most players in the sector are now importers of finished petroleum products.
The anticipated upward adjustments in domestic pump prices next week could be due to the precipitous recovery in global oil prices, as there had been a sharp increase in the collapse of the previous week.
Experts have noted that the international benchmark Brent crude fell back to $ 72 a barrel at the end of last week – and that’s a remarkable turnaround from its steep drop to $ 64-65 a barrel during the second to third week of August.
Market watchers have previously attributed the downward trend in international oil prices to the resurgence of Covid-19 infections due to the Delta variant. However, last week’s price rally was blamed on “China’s bullish demand outlook” and supply disruptions in the Gulf of Mexico.
It was pointed out that due to a fire at the Ku-Maloob-Zaap offshore platform in Mexico, around 400,000 barrels per day of oil supplies were suddenly taken off the market.
Industry experts thus noted that this recent geopolitical incident and the resulting sustained development of the Chinese market had somewhat eased concerns about the rise in coronavirus infections and its impact on global demand for oil. Higher demand for petroleum products is also anticipated with the easing of mobility restrictions in the country.
Based on Department of Energy (DOE) monitoring, the overall pump price adjustments since the start of the year have further resulted in a net increase of 12.45 pesos per liter for gasoline; P9.35 per liter for diesel; and 7.40 P per liter for kerosene.
SUBSCRIBE TO THE DAILY NEWSLETTER
CLICK HERE TO JOIN