By Myrna Velasco
Following two weeks of price cuts, Filipino consumers would be back into getting their pockets pinched with the estimated hefty price increases in petroleum products this coming week.
As initially calculated by industry players, gasoline prices may be at increases of P0.95 to P1.00 per liter; while the costs of diesel and kerosene commodities may go up by as much as P0.75 to P0.80 per liter.
That has been based on the outcome of four-day trading in the world market, and the final price hikes could change depending yet on the outcome of last week’s Friday trading. Domestic pump prices are expected to increase by Tuesday (May 21).
Prior to this anticipated new round of adjustments, the prevailing oil prices in Metro Manila as monitored by the Department of Energy (DOE) had been P45.25 to P62.26 per liter for gasoline; diesel at P40.70 to P48.25 per liter; and kerosene at P45.29 to P58.95 per liter.
Market fundamentals had been on recurring themes, but last week, it is worth noting that a fresh round of tension had escalated in the Middle East, which consequently had been viewed exerting pressures on the market – not just on supply but on price points.
Dubai crude, which is the pricing reference for Asian refiners, had gone higher to more than US$71 per barrel last week after its fall to the US$69 per barrel in the past two weeks.
Brent crude as the major reference for global oil markets had been at more than US$72 per barrel; while West Texas Intermediate (WTI) crude had been at a high of US$62 per barrel.
Beyond the geopolitical strains, industry analysts have similarly noted the declining rig count in the US market as added facet affecting market dynamics, primarily in the last several weeks.
Over this weekend, ministers from the Organization of the Petroleum Exporting Countries (OPEC) and the Russian-led alliance of oil producers will be meeting in Jeddah, Saudi Arabia primarily “to assess market conditions” prior to any portended agreement that they will reach in their Vienna meeting next month.
Before this gathering of the global oil producers though, several attacks on Saudi Aramco’s facilities happened – including one of its pipelines in Saudi Arabia; and its oil tankers in the United Arab Emirates, and both were suspected as acts of “terrorism and sabotage.”
Assaults on oil facilities as well as the sanctions being enforced on Iran and Venezuela have been the constant intervening factors influencing not just supply flow, but also the pricing of oil in the world market.