By Myrna Velasco
Two of the country’s smaller oil companies initiated this weekend’s price rollback trend – cutting prices of diesel and gasoline by P1 per liter.
Unioil will be the first to enforce price cuts effective today, December 22 at 6 a.m., its media advisory said.
Another oil industry player Jetti Petroleum, indicated that it will be reducing prices by Monday, December 24, although it had not given specific rollback prices yet.
Most of the major oil companies had been steady on their pricing movements, often following the Tuesday routine, which will likely be on Christmas day this coming week.
Domestic pump prices are continually going down due to the softening prices in the world market – buoyed primarily by higher inventory of the United States.
The price collapse had been happening despite the recent decision of the Organization of the Petroleum Exporting Countries (OPEC) and Russian-led alliance to cut production by 1.2 million barrels per day.
This is another round of market rebalancing strategy that the global oil market has been resorting to so they could reinforce sagging prices – the same phenomenon that troubled the market in 2014.
Given the current dilemma of the international oil markets, industry analysts have been pointing to possible struggle of many exploration and production (E&P) firms to post reasonable shareholders’ value on injected investments.
It has been a boom and bust cycle in the world oil market in the past four years. And just when industry placers expected prices to go up, a fresh round of price reductions happened.
In the import-dependent market like the Philippines, however, lower prices are always viewed as a positive development.