Another round of significant oil price cuts due next week

Published November 27, 2021, 11:30 AM

by Myrna M. Velasco

Oil prices at petroleum pumps will be on significant rollbacks next week, its fourth reduction for the month, giving additional relief to Filipino consumers who are already braving traffic as they go back to work or other travel activities.

As calculated by the industry players, the price of gasoline will be trimmed by P1.15 to P1.30 per liter while diesel prices will have a leaner price reduction of P0.60 to P0.70 per liter. These prices are just prospective adjustments based on the Mean of Platts Singapore (MOPS) and have not factored in yet other components that can affect final pricing at the pumps.

By the same token, the price of kerosene, a fuel commodity widely used in the aviation industry, will also go down by estimated P0.45 to P0.55 per liter.

The domestic oil firms will adjust their prices on Tuesday (November 30). This is already the fourth in a series of rollbacks implemented at the pumps this month.

Global experts noted that the prices of fuel commodities have been on another round of decreases because of the emergence of a new and more deadly South African variant of the coronavirus.

The precipitous slide of oil prices, that skidded to a low of US$69 per barrel for crude as of Friday (November 26), had been mainly attributed to the menacing impact of the new Covid strain which already prompted fresh call of lockdowns in Europe; and has also been instigating surge of new cases in some parts of the world.

Market watchers indicated that with the new coronavirus variant, mobility restrictions could intensify again that could result in apparent downtrend of demand for oil commodities – both for human and economic activities.

Some countries, including the Philippines, have started closing their borders to travels originating from jurisdictions in the African continent where the new Covid variant had been detected.

The Philippines, heavy traffic has been back in major thoroughfares in Metro Manila as many Filipinos now go through their usual chores of holiday shopping.

Adding to higher fuel consumption in the country is also the wider reopening of the economy, which then prompted many companies and organizations to mandate their employees to physically return to their places of work, albeit with some hybrid or rotation arrangements being enforced.

There are no specific assessments yet how the new Covid-19 variant could stall people’s mobility anew in the Philippines and how will this dampen the economy that is just re-starting to flourish.