Massive oil price hikes again set next week

Published October 16, 2021, 11:34 AM

by Myrna M. Velasco

Motorists will have to brace for heftier gasoline price hikes next week of P1.90 to P2.00 per liter, according to calculations by oil companies.

For diesel products, the anticipated price increase will be to the tune of P1.35 to P1.45 per liter while kerosene products are projected to increase by P1.30 to P1.40 per liter.

Oil pumps

This is already the third week this month that massive price hikes were implemented for fuel commodities being retailed at the pumps. Aggregate increases are now hovering at P2.75 per liter for gasoline; P3.55 per liter for diesel; and P3.50 per liter for kerosene products.

Oil companies will enforce the new round of price upswings on Tuesday, Oct. 19. The price hikes are based on the Mean of Platts Singapore (MOPS), which is the deregulated industry’s reference pricing on their weekly routine of cost adjustments.

As noted by experts, price spikes could still reign in oil markets in the days and months ahead as benchmark Brent crude was already hitting US$85 per barrel last week – and it closed at $84.86 as of Friday, Oct. 15 trading.

Industry watchers emphasized that the astronomical rise in gas prices have been prompting shift to higher oil utilization, hence, that has been exerting further pressure on available supply.

Based on the forecast of global think tank International Energy Agency (IEA), oil demand could escalate by as much as 500,000 barrels per day due to the global energy crisis that have been triggering the ‘gas-to-oil switching’ in many markets.

It was further indicated that uptick in Asia’s oil demand has also been returning following higher Covid-19 vaccination rates in many countries in the region, resulting in broader economic reopening in these jurisdictions.

In the Philippines, the public transport sector is now pressing government to allow public utility jeepneys (PUJs) to jack up the minimum fare by P3.00 to P12.00 from currently at P9.00.

The relentless rise in oil prices is turning up as another financial dilemma to many Filipinos, especially so since many workers will soon be returning to their ‘physical workplaces’ as movement restrictions in the capital ease.

Beyond its impact on the commuters’ pockets, high oil prices will also have knock-on effect on the prices of basic commodities because the manufacturing sector uses oil in the production as well as in the transport of goods.

 
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