Oil prices to increase next week

Published April 17, 2021, 12:05 PM

by Myrna M. Velasco

As global oil prices swung to new highs last week, price increases at Philippine pumps are anticipated again next week.

Based on the calculation of the oil companies, the highest increase for kerosene products could be P0.85 to P0.90 per liter. This commodity is largely regarded as a base for aviation fuel and is also commonly used in households and other industries.

MB file photo. (Mark Balmores)

The oil firms further computed that gasoline prices would be adjusted upwards by P0.45 to P0.55 per liter; while diesel prices will rise by P0.60 to P0.70 per liter.

The return to “price hikes regime” is coming following a two-week reprieve, given the slight rollbacks and very marginal hike implemented early this month.

Oil companies are expected to implement the price hikes on Tuesday (April 20), and it will be generally anchored on the Mean of Platts Singapore (MOPS), which is the pricing reference adopted by the domestic market.
Meantime, a monitoring report of the Department of Energy (DOE) showed that year-to-date oil price adjustments were still on net increase of P6.55 per liter for gasoline; P4.65 per liter for diesel; and P3.45 per liter for kerosene.

In the global scene, benchmark Brent crude had risen anew to the level of US$66 per barrel after it had fallen to the $63-$64 per barrel mark in recent weeks; while Dubai crude which is a reference pricing for Asian markets hovered at US$63 per barrel in last week’s trading.

According to industry watchers, markets have been weighing the impact of the decision of global producers led by the Organization of the Petroleum Exporting Countries (OPEC) to start increasing output by next month; and that’s being reckoned with the lingering concerns of Covid-19 infections vis-à-vis the pace of inoculation programs of most countries.

The news of robust 18.3-percent economic growth reported by China, one of the world’s biggest oil consumers, was also seen lifting sentiments in oil markets especially on prospects of demand shoring up.

For gasoline products, in particular, it was noted that several countries in Asia such as Indonesia, Vietnam, Sri Lanka and Egypt, have been driving up demand – and this has been happening amid the scheduled refinery shutdowns in the region.