Gasoline on continued hefty rollback; marginal cut for kerosene

Published November 13, 2021, 11:19 AM

by Myrna M. Velasco

After last week’s relief on consumers’ pockets, motorists using gasoline products on their vehicles can continue to breathe easy as this commodity will have another hefty rollback of more than P1.00 per liter next week.

Based on calculations by industry players, the widely used 92 RON unleaded gasoline will have price cuts of P1.10 to P1.20 per liter; while premium gasoline products at 95 RON may even incur bigger price reductions of P1.30 to P1.40 per liter on Tuesday, Nov. 16.

For diesel, which is the preferred fuel for public transport, there is possibility of ‘no price change” or the rollback could just be at very marginal P0.05 per liter; while for kerosene, this will likely be trimmed by P0.15 to P0.20 per liter.

International market watchers nevertheless cautioned that the two-week series of rollbacks may not last long as the price of international benchmark Brent crude had been on a new rally at $82 per barrel, reversing the leaner $78 to $79 it had waned into the other week.

It could be gleaned from a monitoring report of the Department of Energy (DOE) that after last week’s price cuts, fuel cost swings since the start of the year still incurred net increases of P20.95 per liter for gasoline; P17.50 per liter for diesel; and P15.09 per liter for kerosene.

According to global experts, oil prices will likely hover at $80 to $85 per barrel range in the remainder of the year, although there are also prospects of ‘price softening’ given recent forecast of the Organization of the Petroleum Exporting Countries (OPEC) of weaker demand in the fourth quarter due to lower-than-expected economic recovery.

On the relentless plea of the public utility vehicle (PUV) drivers for cheaper petroleum products, Petron President and CEO Ramon S. Ang recommended that they shall explore buying from the independent players because these retail outlets typically sell at prices that are lower by P10.00 per liter.

“The new players have very low overhead, very, very efficient that they were able to sell on an average P10 per liter cheaper than us,” he said.

Ang asserted that the dilemma of the drivers can already be solved by the lower prices being offered at the pumps by the new players– and their stations are also widespread nationwide because they already have 40-percent market share in the deregulated oil market.

“There are new players and they comprise 40% in terms of number of gas stations all over the Philippines. And the new players’ gas stations on average sell their gasoline and diesel cheaper than Petron, Shell and Caltex,” he expounded.

Ang thus highlighted that “if we are looking for solutions on how we can help the jeepney drivers, taxi drivers and bus drivers, then that is the answer – they can buy from the new players because I think their overhead cost is low, that’s why they can sell P10 cheaper.”

Petron said it can share with the PUV drivers its price monitoring list, so they will know the specific gasoline stations where they can buy cheaper petroleum products, primarily gasoline and diesel commodities.

Ang opined it may not be a feasible option to suspend the excise taxes of petroleum products, given the country’s gaping budget deficit and the humongous debt of the government that had swelled by additional P6 trillion in the last five years.

On the proposal to temporarily stop the collection of petroleum taxes – chiefly excise taxes and value added tax (VAT), he further reckoned that “the government cannot afford to suspend taxes.”

 
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