Another round of hefty oil price hikes next week

Published October 9, 2021, 11:06 AM

by Myrna M. Velasco

As Christmas shopping nears, Filipino consumers must also factor in higher fuel budgets with the anticipated next round of hefty oil price hikes next week at P1.30 to P1.40 per liter for gasoline products, and P1.40 to P1.50 for diesel products.

For kerosene, which is widely used in the aviation industry because it is considered lighter or ‘less viscous’ fuel when used in flights, this will also be rising by P1.45 to P1.55 per liter as global citizens turn more hyperactive on their travel plans and holidays.

The country’s oil companies will be increasing their prices on Tuesday, Oct. 12, and that will be generally anchored on cost movements of the Mean of Platts Singapore (MOPS), a pricing reference adopted by the deregulated downstream petroleum industry in the Philippines.

International benchmark Brent crude traded around $82.5 per barrel mark last week. Experts already raised warning of prolonged surges in prices as global oil demand picks up mainly due to the economic recoveries of many countries post-pandemic and on the inventory build-up of several other nations for their winter heating requirements.

Forecasts of $100 per barrel oil has also been persisting, with experts noting that anticipated oil supply addition may not be pumped into markets are they are needed.

This is the second week this October that pump prices would climb significantly. It is already the seventh straight week of price increases since the latter part of August.

A monitoring report of the Department of Energy (DOE) showed that price swings since the start of the year incurred net increases of P16.55 per liter for gasoline, P15.00 per liter for diesel, and P12.74 per liter for kerosene products.

Given the continuing surge in domestic pump prices, the energy department will be holding a dialogue with the oil firms next week on how they can possibly extend help to the vulnerable sector – primarily those in the public transport groups.

Public utility vehicle (PUV) operators and drivers already raised high probability that they will apply for fare hikes if the incessant rise in oil prices will persist in the coming weeks even as many Filipinos are still reeling hard from financial woes triggered by the coronavirus pandemic.

The astronomical rise in oil prices will also have spiraling effect on prices of basic goods because fuel is an important commodity used in manufacturing processes as well as in the transport of goods.