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Tuesday, February 27, 2024

Mixed movement seen for prices of fuels next week

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Oil prices may have a mixed movement next week, with a possible rollback in gasoline of up to P1.90 per liter, while diesel prices may increase by up to P0.20 per liter or remain the same.

On the other hand, kerosene prices are also expected to go down by about P0.60 per liter.

This is based on the four-day trading of the Mean of Platts Singapore (MOPS), the pricing benchmark used by oil importers.

“We are expecting a mixed movement on the prices of petroleum products: gasoline – (P1.60 to P1.90) rollback, diesel – no movement or increase of P0.10 to P0.20 per liter and kerosene – (P0.40 to P0.60) rollback,” a source told Manila Standard.

The Department of Energy (DOE) confirmed the expected oil price movement next week.

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“Prices are still volatile and we need to manage our expectations,” DOE director for the oil industry management bureau Rodela Romero said.

Romero said world oil prices softened in the first few days of the week due to elevated interest rates, higher US dollar, and the relaxation of Russia’s fuel import ban.

“But the long-term reason for the increase still the extension of the voluntary cuts of Russia and Saudi until end of December 2023. Added to it, is the fall of US stockpile contributing to worries of tight global supplies and unexpected strong demand from China,” she said.

Energy Secretary Raphael Lotilla said world oil prices may continue to be volatile despite forecasts of possible rollback in the domestic market.

“You know that it is volatile and we have to always you know be ready. Because we are already moving towards the winter months and normally, the prices will increase but let us hope that the external factors like Ukraine, and Russia will stabilize,” Lotilla said.

World oil prices normally go up during the winter months due to the higher demand for heating.

“Prices may go up and down so we have to manage expectations that it will continue to go down because there are a lot of external factors involved.  So, let’s hope the conflict of Russia and Ukraine will be resolved so prices of oil products will normalize,” the energy chief said.

“So we must continue to save on unnecessary trips outside of the house, let us use mas transport systems so we can save on these expenses,” he said.

Average price for gasoline in the National Capital Region currently range from P62.30 to P89.95 per liter, diesel from P62.60 to P86.92 per liter and kerosene from P80.25 per liter to P92.59 per liter.

On Sept. 26, the oil firms cut pump prices by P0.50 per liter for kerosene and by P0.20 per liter for gasoline and diesel to reflect the movement of prices in the world oil market.

This was driven largely by the US Federal Reserve’s warning of more price hikes although this was tempered by expectations of tight supply until the end of the year.

The latest price rollback resulted in a year-to-date net increase of P17.30 per liter for gasoline, P13.40 per liter diesel and P9.44 per liter for kerosene.

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