Filipino households will need to spend more on their cooking fuel budget this month as the price of liquefied petroleum gas (LPG) had been up by P1.00 per kilogram or an equivalent P11.00 for the standard tank.
The products of industry players — Petron Corporation for Gasul brand; Phoenix Petroleum for its Super LPG; and Isla Petroleum and Gas Corporation for its Solane LPG — had been increased since October 1 (Thursday).
Petron and Phoenix Petroleum announced value added tax-inclusive adjustments at P1.00 per kg; while Isla Petroleum advised of P0.89 per kg hike but the 12-percent VAT has yet to be added to it.
Similarly, the oil firms sent notices on P0.55 to P0.56 per liter uptick in their auto LPG fuel effective October 1 for Petron and Phoenix Petroleum; while Cleanfuel enforced it beginning October 2 (Friday).
Auto LPG is an alternative fuel being used in the transport sector, mostly by taxi fleets, as underpinned by a government program implemented more than a decade ago.
Prior to this round of adjustment, a monitoring report of the Department of Energy (DOE) indicated the pricing of LPG products at retail outlets had been at P840.00 to P2,187.00 for the typical cooking cylinders.
The swing in prices of LPG follows trends in the international market – primarily the international contract prices of Saudi Aramco, which is the regarded benchmark for the Asian markets.
The energy department explained that the Saudi Aramco contract prices (CP) are closely watched by LPG industry because “they tend to set a base level for LPG pricing for most markets east of Suez.”
These price movements, it added, are generally anchored on LPG lifted from the Saudi ports of Yanbu, Ras Tanura and Ju’aymah, which are under term supply contracts.
Aside from the Aramco contract prices, the DOE indicated that foreign exchange monthly average fluctuations would be the other key determinant in the pricing of LPG in the domestic market.
“Following the timing of the monthly changes in CP, domestic price of LPG also varies every first day of the month and remain constant through the whole month,” the DOE said.
It emphasized that “like all other petroleum products, the Philippines has no influence over the LPG contract price as the country’s domestic requirement is small versus world demand.”