Another round of big-time oil price hikes next week

Published February 13, 2021, 11:57 AM by Myrna M. Velasco
https://mb.com.ph/2021/02/13/another-round-of-big-time-oil-price-hikes-next-week/

Big-time fuel price hikes of as much as P1.30 per liter are expected next week following further rally in the world market prices.

Based on the initial calculation of the oil companies, the biggest price hikes will be felt on diesel products at the range of P1.25 to P1.30 per liter; while kerosene prices will likely rise by P1.10 to P1.20 per liter.

Gasoline products are anticipated to have leaner upward price adjustments of P0.75 to P0.85 per liter, according to the oil firms.

The increases in prices are still in keeping with the incessant climb in global oil prices, with international benchmark Brent crude already breaching $62 to $63 per barrel in last week’s trading.

Dubai crude, which in general is a pricing reference for Asian oil markets, already surged past $60 per barrel, based on last week’s trading outcomes.

In the country, the Bangko Sentral ng Pilipinas (BSP) already warned of spiraling impact of the rising oil prices – primarily in the cost of basic commodities; and this has been exhibiting pessimistic outlook to consumers especially for an economy reeling hard from the extreme blow of a pandemic.

In this year’s series of price adjustments in the domestic market, the net increase for gasoline products already hovered at P3.25 per liter; diesel products had already been higher by P2.65 per liter; while kerosene products logged aggregate increase of P2.25 per liter.

According to oil market experts, global prices have been rising as most producers are keeping their commitment to hold back supply; in addition to the influencing factor on green shoots of recovery now manifesting for the US economy.

In the February 3 meeting of the Organization of the Petroleum Exporting Countries (OPEC) and its ally-producers, collectively known as OPEC +, they were able to assess that their adherence to production cuts somehow reduced overall global oil inventories and helped lift sagging prices.

Given that scenario, the world oil producers resolved not to recommend any changes in their production freeze accord, resulting in rising prices.

In the Asian market, it was noted that trading had likewise grown more bullish in recent weeks, as more countries in the region have been easing restrictions and prepping their economic activities to rebound phase.