Philippines: Diesel Prices to See Significant Drop, LPG to Rise

Oil companies are expected to cut diesel prices by as much as P3.83 per liter, according to industry announcements. In separate advisories on Monday, the companies announced a fresh round of rollbacks starting on Tuesday, Sept. 1. Seaoil Philippines, Inc. will cut pump prices by P0.32 per liter for gasoline, P3.83 for diesel, and P3.84 for kerosene. Shell Pilipinas Corp. is set to slash gasoline prices by P0.30 per liter, diesel by P3.80, and kerosene by P3.80 per liter. Jetti Petroleum, Inc. President Leo P. Bellas said gasoline prices remained lower than the previous week amid increased Chinese exports, but regional supply remained tight, limiting the impact of those additional exports. “Healthy supply due to improving crude availability continues to pressure diesel, but further downside is capped by the still-limited availability of Middle Eastern exports,” Mr. Bellas said via Viber. As of Aug. 21, the fuel inventory was sufficient for about 47.22 days’ consumption, according to the Department of Energy (DoE), with average daily demand estimated at 78.08 million liters. The gasoline inventory was equivalent to 44.39 days’ demand, diesel 47.66 days, kerosene 121.85 days, jet fuel 75.57 days, fuel oil 54.33 days, and liquefied petroleum gas (LPG) 34.49 days. Energy Secretary Sharon S. Garin has said that the government intends to hold on to the diesel procured during the energy crisis to maintain supply but is about to sell off the remaining LPG reserves. Arnel U. Ty, founder of the LPG Marketers’ Association, Inc., said LPG prices are estimated to increase by P3 per kilogram due to higher shipping costs and weak peso. “The slight decline in crude oil prices last week did not have an immediate effect because shipping costs are compared over the preceding three weeks,” Mr. Ty told DZMM radio. “Since crude oil prices still posted a net increase over that period, this was reflected in the shipping cost,” he added. Citing the Saudi Contract Price — the international price benchmark set at the beginning of each month by state-owned Saudi Aramco — Mr. Ty said propane increased $5 per metric ton (MT) to $625 and butane rose $20 per MT to $660. — Sheldeen Joy Talavera