Prices of diesel down, gas up Tuesday
MANILA, Philippines—Oil firms are rolling back diesel prices lower than expected hiking gasoline prices amid weakened demand for heating fuel in markets going through the winter months.
Shell announced Monday night that it will slash off 55 centavos per liter from the price of its diesel products starting 6 a.m., Tuesday. It will raise gasoline prices by 40 centavos per liter while kerosene prices will be unmoved. Shell said the adjustments will be implemented nationwide except in Aklan, Bohol, Capiz, Leyteand Samar—all calamity areas.
Also on Monday, PTT Philippines announced a 55-centavo per liter rollback on diesel and 40-centavo per liter increase on gasoline from 6 a.m., also on Tuesday.
Earlier, estimates from sources ranged from 40 to 50 centavos per liter for the diesel rollback and a commensurate gasoline hike of from 40 to 50 centavos per liter. The Department of Energy also said there may be a 50-centavo per liter rollback in diesel prices this week and a corresponding 50-centavo per liter hike in gasoline.
The Eastern Petroleum Group was ahead of other oil firms in announcing planned adjustments. Last week, toward the weekend, Eastern Petroleum said it may implement a diesel rollback of about 60 centavos per liter and a gasoline price hike of around 30 centavos per liter.
Estimates were based on the average trades during the Dec. 9 to 13 trading week for MOPS (Mean of Platts Singapore), the benchmark for Philippine fuel products, which are mostly imported.
Despite the gasoline hike, industry experts said fuel prices are generally more stable than in 2008, when commodity prices for oil, metal, rice and related products surged unsustainably.
Eastern Petroleum chairman Fernando L. Martinez said the adjustments could have a side effect that would benefit commuters. The diesel rollback, which impacts the transport sector, could very well “deflate” calls for fare hikes, he said.
Other oil firms have announced neither diesel rollbacks nor gasoline price hikes. Generally, however, oil firms track each other’s prices as most of the fuel products in the Philippines come from imports.
Traditionally, Martinez said, heating fuel such as diesel and kerosene enjoy stronger prices in the winter months due to demand from Northeast Asia, Europe and North America. However, oversupply could happen when plants stock up too much in anticipation of demand and may need to liquidate after initial sales. It may also happen that some plants need more gasoline, Martinez said.
