The financial burden of consumers on their fuel budgets will be aggravated this week as the cost of gasoline and diesel products are expected to increase this week.
Based on estimates, the price of gasoline will rise between P0.95 to P1.05 per liter; while diesel prices will climb by P1.05 to P1.10 per liter.
Kerosene, which is the other essential commodity on the weekly price adjustments, will also have anticipated increase ranging from P0.95 to P1.05 per liter.
Oil industry players will announce the price hikes on Tuesday (January 19).
This is so far the third week of price adjustments this January where prices of gasoline in the first two weeks of the year already went up by P1.30 per liter; while diesel prices had been hiked by P0.60 per liter.
Kerosene, which is the base for aviation fuel, likewise increased by P0.65 per liter in the first two weeks of this year despite the re-enforcement of travel restrictions in many parts of the world because of the emerging new coronavirus strains.
The main factor that triggered rally in prices in recent trading days had been the announcement of Saudi Aramco, the world’s biggest oil producer, on its 1.0 million barrel production cut by February to March this year.
That was seen as a ‘surprise twist,’ because global oil producers actually came up with a consensus to gradually increase output within this first quarter to boost supply in the market given expectations of wider economic recovery as Covid-19 vaccinations are ramped up in many parts of the world.
In the Philippines, oil companies were quizzed anew during a Congressional hearing last Friday (January 15) on the methodology and the manner they have been adjusting prices at the pumps – especially in adopting the Mean of Platts Singapore (MOPS) as a pricing reference.
The Department of Energy (DOE) has been pushing for amendments in the Oil Deregulation Law and it wants to integrate ‘fuel cost unbundling” as a major tweak in the policy to effect transparency in pricing.
The segregation of various cost components of fuel commodity prices was initially enforced last year via a DOE Department Circular, but this was fiercely opposed by the oil companies with them stating that there are relevant information that will compromise their businesses, especially on the sets of data being demanded relative to the fuel cost unbundling policy. In the end, the price unbundling policy was junked through Court rulings.