Petroleum prices continue to rise

There is no letup in the increases in petroleum prices as oil rates continue its rally in the world market, according to industry players.

Based on estimates of the oil companies, the outcome of five-day trading in the international market last week will trigger price hikes of P0.80 to P0.95 per liter for gasoline products; P0.65 to P0.75 per liter for diesel; and P0.45 to P0.55 per liter for kerosene.

The price adjustments are expected to take effect on Tuesday, 1, Feb. 1, which is in keeping with the routine of the industry players in the deregulated downstream oil industry. The hikes in prices are based on the Mean of Platts Singapore (MOPS) indices.

The upswing in pump prices, according to the Department of Energy, is ignited by the combined impact of soaring prices in the world market and the depreciating value of the Philippine peso versus the US dollar.

Just for the month of January alone, the series of four-peat upward cost adjustments already resulted in aggregate increase of P4.95 per liter for gasoline; P7.20 per liter for diesel; and P6.75 per liter for kerosene.

Apart from fuel commodities at the pumps, there are also early calculations that the price of liquefied petroleum gas (LPG) may track uptrend next month, based on what is being seen as probable jump in LPG international contract prices for February.

For oil prices, global benchmark Brent crude gyrated into the $90 per barrel territory last week, still on market assumptions of falling oil inventories – including the spare capacity that may be injected by the Organization of the Petroleum Exporting Countries and its ally-producers (OPEC+).

The price surges came despite the anticipated supply addition of 400,000 barrels by the OPEC+ producers next month. The additional supply has prompted market watchers and global investment banks to reinforce projections that a $100 per barrel oil will soon be on its way.

For instance, the United States, the world’s biggest oil consumer, has reported three-time decline in its commercial stocks and that has been viewed by experts as a ‘not-so-uplifting" news for the oil markets.

Exerting added pressure on global prices, experts noted, had been the relentless geopolitical factors perturbing market fundamentals, including the Russia-Ukraine standoff that is feared to be resulting in market embargo -- that in turn could trigger geopolitical premium on prices.

In the Philippines, the public transport sector and even wider base of motorists are getting agitated again as the weekly adjustments at the pumps have been causing deeper hole on consumers’ pockets.