Oil companies hope the Department of Finance will not change its mind and reimpose higher excise taxes in January so that consumers can get a break from the effects of higher inflation.
At the same time, they carried out price cuts in the last two days to reflect the movement of oil prices in the world market.
Phoenix Petroleum Philippines announced a price cut of P1.10 per liter for gasoline and P1 per liter for diesel on Sunday but other oil companies carried out lower price cuts of P1 per liter for gasoline and P0.90 per liter for diesel effective Monday.
Eastern Petroleum and Seaoil Philippines followed the move of Phoenix but PTT Philippines and Pilipinas Shell Petroleum Corp. cut prices slightly lower, marking the fourth consecutive weekly price rollback.
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“That’s the beauty’ of deregulation. To gain competitive advantage some companies make price differentiation. In the bigger picture, we’re positive that his fourth straight week of price rollbacks and the availability of NFA rice and reduction in the price of commercial rice will certainly reduce inflation for the last quarter of the year,” Eastern Petroleum president Fernando Martinez said.
“Nonetheless, the oil price rollbacks should not encourage DOF [Finance Department] to reimpose the P2.50 per liter specific tax which was officially deferred… to give consumers breathing room from inflationary pressure,” Martinez said.
Phoenix Petroleum Philippines led the latest price rollback on Sunday.
“For the 4th straight week and for motorists to enjoy lower pump prices for the long weekend. Phoenix Petroleum Philippines will decrease the prices of gasoline by P1.10 per liter and diesel by P1 per liter effective 6 am of 04 November 2018,” the company said in its advisory.
Before the latest rollback, gasoline sold for P50.40 to P64.65 per liter and diesel sold for P45.05 to P53.69 per liter. Kerosene sold for P50.07 to P60.20 per liter.
The oil companies also implemented a P1.50 to P1.65 per liter price cut for gasoline, P0.60 per liter for diesel and P0.65 per liter for kerosene effective Oct. 29.
Oil prices were also reduced on from Oct, 20 to 22 with rollbacks ranging from P1.85 to P2.00 per liter for gasoline, P0.90 per liter for diesel and P0.90 to P0.95 per liter for kerosene.
Year-to-date adjustments prior to the latest rollback implemented are a net increase of P8.70 per liter for gasoline, P10.60 per liter for diesel and P9.60 per liter for kerosene.
The Philippines imports more than 90 percent of its fuel requirements thus it is exposed to price volatilities in the world market.
World oil prices have declined recently but the market remains positive on the supply security due to the several developments, the Department of Energy said in its monitoring report.
It said oil prices continued the downward trend after reports of a strong build-up in US crude stockpiles and increased confidence about the availability of supplies towards the end of the year and into early 2019.
Swelling US inventories and concern that trade wars were curbing economic activity also pushed oil prices down.
Traders also noted that Iran’s exports have not declined as much as predicted a couple of months ago and it is now clear they will not fall to zero, even after US sanctions are imposed against Iran.
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