Everybody is cursing no end to the skyrocketing cost of gasoline and especially diesel, which is the so-called “fuel of the economy.”
With the cost of diesel now at P11 more than the gasoline, inflation has gone loose and wild these past few months.
Aside from it, people are also getting angrier with the steady increase in the cost of all their every needs. Not only many jeepney and taxi drivers have stopped plying their routes because of the high cost of fuel, but those truckers and haulers of foods and industrial needs which contributed to their skyrocketing costs, too.
The fuel prices started its full-blown increase with the start of the war between Russia and Ukraine, but many think that the current transition on going electric on vehicles in the near future also has something to do with the spiraling cost of fuel.
All our fuel needs are imported abroad and are dependent on the fluctuating (and more than always, skyrocketing) prices on the international market. With the huge cut on importation from Russia (one of the biggest fuel producers in the world) and a cut in production from the Middle Eastern countries (the regular supplier of fuel in the whole world), exacerbated by the huge demand worldwide plus the closure of several major refiners, the grim result is the skyrocketing prices of fuel.
Refiners turn crude oil into usable products like gasoline and diesel. Some of them closed shop during the pandemic when the demand for fuel nosedived because of the preventive lockdowns all over the world. Although the economy world-wide had started opening up, most of those closed refineries are entertaining second thoughts on re-opening since it would entail another huge cost restarting their engines. The threat of the world going fully electric on vehicles might happen sooner than everyone expected… what would happen to their business (refineries) then?
Meantime, sensing they can earn more and also to get back at those who are trying to kill their businesses (with the whole world going fully electric on vehicles is a sure-fire threat), the Middle Eastern oil producing countries have started cutting their production. Although they see the electric vehicles as a direct threat to their business, these Middle Eastern countries believe that it would take some time (since only Europe, and partly China, had already established infrastructure for electric vehicles) before the whole world has fully transitioned to it. For now, what they are thinking and doing is to squeeze large profits from the fuel-thirsty world.
Although they are very quiet on the issue of the electric vehicles, these oil-producing countries think that the world is not yet ready to go all out on it. Now is the ripe time to earn more as the demand for their products have gone overboard. Less production means less oil in the market while the demand is so high resulting to huge earnings for their pockets.