LPG prices coming down after midnight Friday

INQUIRER file photo

MANILA, Philippines—Amid continuing weakness in the global oil market, fuel retailers are rolling back prices of liquefied petroleum gas for the month of November.

In separate advisories, Petron Corp. and Isla LPG Corp. said they would trim LPG prices starting 12:01 a.m. on November 1.

“Petron will roll back the prices of Gasul and Fiesta Gas LPG by P7 per kilogram (kg) effective 12:01 a.m., November 1. This is equivalent to a decrease of P77 for an 11-kg household cylinder. Xtend AutoLPG prices will likewise decrease by P3.91 per liter at the same time,” Petron said.

“Please be advised that we are reducing our Solane branded LPG price by 6.72 per kg VAT inclusive effective 12:01 a.m. Saturday, November 1, 2014,” Isla LPG said in a separate statement.

Earlier this week, the oil companies cut the prices of major fuel products in what has turned out to be weekly price rollbacks for more than a month now.

Year-to-date total adjustment for gasoline was at a net decrease of P5.48 per liter while prices for diesel were at a net decrease of P7.20 per liter.

The Organization of the Petroleum Exporting Countries said that even with geopolitical risks in areas such as Iraq, where sectarian fighting has threatened fuel routes, the global oil market is awash with supply with North America experiencing an energy boom.

North America seems to be the main culprit behind non-OPEC supply growth this year. The U.S. Energy Information Administration said weekly petroleum inventories show that commercial crude inventories increased by 5 million barrels for a total U.S. commercial crude inventory of 361.7 million barrels.

Even so, Saudi Arabia has apparently said it would not mind seeing oil prices fall to $80 per barrel from the present level of around $90 per barrel and the previous highs of around $100.

A recent OPEC study also showed that supply growth is projected to overtake that of oil demand. At the same time, global commodity prices remain weak in emerging markets and in Europe.

Even gold prices have been wallowing around the $1,200 per ounce level, which is much lower than the $1,800 highs of 2011.

Deflation is also a concern as dropping oil prices may hamper stimulus efforts in recovering economies. In general, dropping oil prices tend to create declining prices elsewhere.