This week’s hefty oil price hikes would be ‘the Grinch” snatching Christmas merriment from the Filipino consumers, with the oil companies announcing P1.60 per liter increase for gasoline and P1.70 per liter hike for diesel products.

Further, the price of kerosene - an essential base for aviation fuel and a key commodity for households and other industries - will also rise by P1.54-P1.55 per liter, according to the price adjustment advisories of the industry players.

As of press time, the oil firms that already sent notices on their price hikes effective Tuesday (December 26) had been Shell Pilipinas Corporation, Cleanfuel, PetroGazz, Chevron, Seaoil, Unioil, Jetti and Phoenix Petroleum; while their competitor-players are expected to match the implemented cost swings.

The domestic downstream oil industry is closing the year with massive price hikes; and this is not bringing cheers to the consumers as the country will soon be ringing in for 2024.

In the international market, there had been a shift in market sentiment following Red Sea attacks of the Houthi militants; as that prompted shipping vessels to divert routes, hence, affecting deliveries of oil products across markets.

As emphasized by global experts, that recent geopolitical event portended supply strain because the rerouting will not only trigger delays in shipments, but will also hike freight costs for product deliveries.

International benchmark Brent crude surged to $80 per barrel last week, but as of end-week trading on December 23, it eased a bit to $79 per barrel, although there’s no certainty yet that the downtrend may be sustained in the trading days ahead.

Apart from the Red Sea assault, market watchers are closely monitoring any possible impact of Angola’s decision to leave the Organization of the Petroleum Exporting Countries (OPEC), reportedly due to friction on production quotas.

So far, Angola is already the third country to exit from OPEC membership, following Qatar’s jettison from the global oil cartel in 2019; and then Ecuador in 2020.

Production cut had become the ‘default action’ of the OPEC and its non-OPEC ally-producers every time there is a need to lift sagging prices, but quite often, that was seen no longer effective as market remedy with the array of other geopolitical events and market risks impacting world oil prices.

For oil import-dependent economy like the Philippines, volatile oil prices will continue to distress the pockets of its consumers – primarily if prices will be on upticks.