By Myrna M. Velasco
Following fresh round of rally in prices in the world market — primarily due to jitters ignited by the United States’ withdrawal from the Iran nuclear deal, commodities at Philippine petroleum pumps are on big-time hikes again this week at P1.20 per liter for diesel; and P1.10 per liter for gasoline.
According to the oil companies’ pricing advisories, the cost of kerosene product, another socially impacting fuel commodity, will also be higher by P0.95 per liter.
As of this writing, the oil companies that already advised on price increases include Flying V of the Villavicencio Group, Pilipinas Shell Petroleum Corporation, PTT Philippines, Chevron (which is carrying the Caltex brand) and Seaoil effective 6:00am on Tuesday (May 15); while the rest of the industry players are expected to follow the price adjustment trends.
As monitored by the Department of Energy (DOE), while oil prices in the Asian markets had been more at steady pace in the past trading week, more gyrations had been observed in other key markets, like mammoth oil-producing Middle East.
Ahead of the Ramadan season, market watchers have already started logging demand rise in petroleum products, primarily gasoil.
On the whole, it was also seen that the stricter compliance to the ‘production cuts’ call of the Organization of the Petroleum Countries (OPEC) along with non-OPEC counterparts led by Russia had been keeping crude prices on the higher end.
Brent crude, in particular, already hovered at $77 per barrel in last week’s trading – manifest that it had already gone a long way since prices hit the depressing bottom of $30-ish per barrel in early part of 2015.
Any seesaw in prices though, as noted by global oil market analysts, had been prompted by reports of higher crude inventories of the United States.
And as further noted by a Philippine DOE monitoring report, “expectation that the United States will re-impose sanctions against Iran remain a threat that could tighten global oil supplies.”
According to a latest S&P Global Platts OPEC survey, Iran shored up its output to 3.82 million barrels per day as of March this year, but with the US move on the nuclear deal, this may strain supply in markets once again.
Iran is an OPEC-member country that had signified its willingness to settle for a “suitable price” of US$60 to US$65 per barrel in the oil market’s rebalancing bid; while giant producer and another OPEC member Saudi Arabia bats for a higher US$80 per barrel.