With bellwether Dubai crude breaching the $62 per barrel last week, oil firms will increase prices this week by P0.90 per liter for gasoline and a leaner P0.55 per liter for diesel.
Kerosene, which is typically intended for domestic use as well as a base for jet fuel, also went up by P0.85 per liter this week.
The first oil company to increase pump prices was Pilipinas Shell Petroleum Corp. effective 6 a.m. Tuesday which has been their routine adjustment timeframe. The rest of the industry players are anticipated to follow.
The oil industry players initially anticipated price hikes of more than P1 per liter for gasoline but Dubai crude softened to $61 per barrel last Friday. As a result, the slight downward adjustment compared to preliminary expected price hikes this week.
Beyond Dubai crude cost’s rise, last week was generally an upswing in global oil prices – even with Brent crude rising by more than $62 per barrel while West Texas Intermediate which is the cost reference for the US market, hovered at close to $53 per barrel.
Industry experts have been noting that several geopolitical factors were exerting pressures on international prices –including the trade clash between the United States and China.
In addition, the US is contemplating imposing sanctions on Venezuelan oil – and its tumultuous political situation could then further cut the South American nation’s oil export volumes.
The Trump administration is also copiously at odds with Saudi Arabia – and that is seen by analysts taking toll on oil markets given the fact that the oil kingdom producer is still the world’s biggest player.
For all of these trade and political disputes, the oil-import depending nations are seen most vulnerable because they are price takers of whatever strain these market vulnerabilities have been stirring up on supply-demand dynamics.
Throughout the year, experts’ forecasts set global prices reaching $70 per barrel this year. Thus, there would still be huge room for increases from where they are today. (Myrna M. Velasco)
