Gasoline prices up by P1.05 per liter; diesel by P0.85/liter

Published June 22, 2020, 12:00 AM

by manilabulletin_admin

By Myrna M. Velasco

Another upward adjustments in pump prices will be implemented by the oil companies today, with gasoline prices rising by P1.05 per liter; and diesel by P0.85 per liter.

The oil companies also advised on P0.30 per liter increase in the price of kerosene products, albeit that had been relatively lower compared to the massive upticks implemented in recent weeks.

As of this writing, the industry players that already advised on price hikes effective Tuesday (June 23) have been Pilipinas Shell Petroleum Corporation, Cleanfuel and PetroGazz while the rest of the oil companies are anticipated to go along with the cost adjustment trends set by their competitors.

Beyond these anticipated price uptrends, several oil companies also increased their product costs by additional P1.50 to P1.60 per liter courtesy of the 10-percent import duty being enforced on crude and finished petroleum products.

While Pilipinas Shell started the import duty-linked upward price adjustments last week, the oil firms that followed include Chevron (which carries the Caltex brand); Petron Corporation, Phoenix Petroleum Philippines Inc. and PTT Philippines.

The hiked import duty that had been laid down under Executive Order No. 113 is part of the government’s strategy to beef up State coffers, so it will have wider financial leverage on its response to the coronavirus pandemic.

For the upswing in prices due to the rally in prices in the world market, the Philippine oil companies noted that the calculations had been based on the Mean of Platts Singapore (MOPS), which is a pricing reference generally adopted in the domestic market.

On crude, international benchmark Brent swung back to the US$42 per barrel level after interim softening the previous week; while Dubai crude was at US$40 per barrel level as of Friday (June 19) trading.

The continuing climb in prices was still attributed to the effect of the extended production cut agreement forged by the Organization of the Petroleum Exporting Countries (OPEC) and its Russian-led ally producers in their meeting on June 6 this year.

Market analysts similarly noted that the spiraling prices had been precipitated by “optimism over a swift and steady economic rebound from crushing pandemic lockdowns.”

They further stated that increases in prices at this point are largely driven by supply, rather than demand – given the shrink in output that global producers had taken as a strategy.