By Myrna Velasco
On combined trigger factor of upswing in global oil prices and the depreciation of the peso against the US dollar, prices of petroleum products at the pumps will rise again this week by P0.65 per liter for gasoline; and P0.35 per liter for diesel products.
For kerosene, which is another commodity with wide social impact on some segments of Filipino communities as well as industries, its price will inch up by P0.45 per liter.
The price adjustments take effect this morning.
As of this writing, the oil firms that already sent advisories on price adjustments were Pilipinas Shell Petroleum Corporation, Flying V, Eastern Petroleum Corporation, Phoenix Petroleum, PTT Philippines, and Total effective 6:00am tomorrow (May 29); while the rest of the industry players are anticipated to follow this week’s pricing trend.
Prior to this adjustment, average prices for gasoline had been at P50.85 to P60.85 per liter; diesel at P41.40 to P47.78 per liter; and kerosene at P47.26 to P57.01per liter, according to data of the Department of Energy.
On Monday’s global oil trading, it was Dubai crude that had been surging compared to others in the crude basket, It had gone up to US$76.72 per barrel while Brent softened to US$74.88 to US$75.20 per barrel; and West Texas Intermediate had fallen to US$66.20 per barrel.
Yet as pump prices are on the rise again, leading independent player Phoenix Petroleum Philippines Inc. has jumped the gun on all industry competitors by extending massive discount to Metro Manila motorists of up to P5.00 per liter on its gasoline products over a two-day period.
The company announced that it will be “offering its high-performance fuels at discounted rates,” for the periods from May 29-30, 2018 from 6:00am to 10:00pm – at discount rates of P5.00 per liter on gasoline and P2.00 per liter on diesel, “to be given to motorists at select Phoenix Petroleum stations in Mega Manila.”
As noted by Phoenix Petroleum Chief Operating Officer Henry Albert Fadullon, “we put our customers’ needs first, which is why we are offering this promo to cushion the impact of price increases.”
The incessant rise in petroleum prices in the past weeks had thrown Philippine government on the edge, with Malacanang going up to the extent of instructing state-run Philippine National Oi Company (PNOC) to explore options of sourcing oil from either the United States or Russia.
Nevertheless, according to industry watchers, prospects of stockpiling at this time when prices are already soaring may be a counter-productive move – instead, this should have been a step considered when international prices were at rock bottom of US$30 per barrel level.
Additionally, the Philippine oil market is of deregulated nature, so it raises question as to where the government-sourced oil will be stored; and how it shall be distributed or sold to private industry players.
Senate Committee on Energy Chairman Sherwin T. Gatchalian indicated that ‘political concessions’ could come as a favorable bargaining chip for the country for cheaper oil.
“Global oil is dictated by global oil prices. The only way we can get cheap oil is through political concessions,” he said; while adding that “good relationship with these oil exporting countries might benefit us to this effect.”
At the upper legislative chamber, Gatchalian indicated that “the committee will definitely support any effort that will drive down the local prices of petroleum.”
Nevertheless, oil-producing countries that are allies of the Philippines, primarily Russia are also among those joining the bandwagon of the Organization of the Petroleum Exporting Countries (OPEC) that had been pushing world oil prices up to the US$80 per barrel.
No less than Russian Energy Minister Alexander Novak had previously made statements that they will be “happy to see the price of oil rising to certain levels” – it was at targeted $70 per barrel last year; and $80 this year and a further rise to $90 per barrel in 2019.
‘Oil diplomacy’ had been exercised by Philippine government in the past — but the country only had that leverage when Saudi Aramco was still a strategic partner of leading oil firm Petron Corporation.