Oil firms seen to hike fuel prices by 50¢

AP FILE PHOTO

MANILA, Philippines—Domestic oil prices are going up again following weeks of softness as global output appears steady despite surging demand from growing economies such as China—leading to concerns of an oil supply squeeze.

Beginning Tuesday morning, oil firms are expected to hike fuel prices by an average of 50 centavos per liter, industry sources said.

The estimated price increases will range from 45 to 55 centavos per liter for diesel and from 25 to 55 centavos for gasoline.

Excluding expected adjustments this week, the year-to-date net increase for gasoline and diesel stand at 69 centavos per liter and P2.23 per liter, respectively.

But as of Monday afternoon, oil firms had yet to make official announcements on a price increase.

Amid the market buzz, transport groups have expressed concern over the price hikes this week.

In a statement, the militant transport group Piston said oil prices should remain low due to expected weakness in US demand as a budget standstill has prompted the world’s largest economy to suspend non-essential government services.

The Department of Energy’s Oil Monitor noted that supply concerns had eased over diplomatic developments in oil-producing Iran and the ongoing US government shutdown, which began on Oct. 1.

But China thirsts for more oil. Increasingly consumer-driven economic growth in the world’s No. 2 economy had it overtaking the United States as the largest oil buyer in the international market. As China’s industries and motorists demand more fuel for power and for transport, global supplies are in for a squeeze, according to analysts.