Oil firms blame strong dollar for price increase
FILE PHOTO: The sun is seen behind a crude oil pump jack in the Permian Basin in Loving County, Texas, U.S., November 22, 2019. REUTERS/Angus Mordant/File Photo
Bad news awaits motorists as industry sources hinted at another round of fuel price increases next week ahead of the Organization of the Petroleum Exporting Countries’ (Opec) meeting next month and a stronger US dollar.
In an advisory over the weekend, Unioil said the price of diesel might increase by 20 to 40 centavos per liter and gasoline by 30 to 50 centavos per liter.
Jetti Petroleum made a similar projection, estimating diesel prices to rise by 35 to 55 centavos per liter and gasoline by 50 to 70 centavos per liter based on the results of the four-day trading in the global market.
Meanwhile, the Department of Energy (DOE) said gasoline might go up by 45 to 65 centavos per liter and diesel by 35 to 55 centavos per liter. Kerosene might increase by 45 to 60 centavos per liter.
“The estimated increases in the prices of petroleum products for next week are attributed to the Opec+ production cut where analysts are awaiting the June 1 meeting that will focus on their output policy; a stronger dollar that makes crude oil more expensive for nondollar economies and the rebound in demand from China,” DOE Oil Industry Management Bureau director Rodela Romero said.
Article continues after this advertisementIf the pump price forecast is right, this could be the second straight time that diesel and kerosene prices would climb.
Article continues after this advertisementFollowing price cut
On Tuesday, oil companies cut gasoline prices by 10 centavos per liter but jacked up diesel and kerosene by 25 centavos per liter and 30 centavos per liter, respectively.
Recently, the DOE approved a higher biofuel blend in diesel and gasoline products starting in October this year, which it said could translate to savings of as much as P4 per liter.
Citing estimates, the DOE said a net savings of P4.17 per liter of diesel might be realized if the biodiesel blend is raised to 5 percent based on a 30,000-kilometer on-road test and a 10 increase in mileage.
