August 2021 – PIP – Philippine Institute of Petroleum

WORLD OIL PRICES (July 26-30, 2021 trading days)

Dubai crude has increased week-on-week by around US$2.00/bbl. MOPS gasoline and MOPS diesel have also increased by almost US$3.00 per barrel and US$ 2.00 per barrel, respectively.

Reasons for the Price Adjustment

Oil Prices finished up for the week ending July 30, 2021 and concluded a run of four consecutive positive months.

o Oil posted its fourth straight monthly gain as steady demand and tight supplies calmed concerns that a new wave of Covid-19 infections would cripple energy consumption.

o Futures in New York ended the week 2.6% higher. While cases of the virus’s delta variant have surged in recent weeks, mobility and other data point to strong demand in key economies that traders are watching. India posted the biggest gain in driving activity after restrictions were rolled back.

o Oil futures are closing out a volatile July that saw prices whipsawing as the pandemic threatened to derail the economic recovery. Crude supplies are expected to remain tight through the end of the year..

&ZeroWidthSpace;&ZeroWidthSpace;&ZeroWidthSpace;&ZeroWidthSpace;Overall, crude prices continued to extend its rally during the week on expectations of a weaker dollar and tighter balances stemming from better demand.
The Asian gasoline market strengthened in early July 26 trading, with support from a stronger US Gasoline-Brent pushing the Asian derivative crack spread to a near three-year high.

o Gasoline demand in several major regions has returned to pre-pandemic levels amid rising road traffic data; even the jet fuel market is showing signs of improvement.

o Meanwhile in Asia, the continued delay of the announcement of China’s second round of oil product export quotas has also propped up the motor fuel complex.

o The uptick in volumes was mainly attributed to healthy regional gasoline crack spreads, which prompted Chinese refiners to export some barrels overseas. Sinochem, Zhejiang Petroleum & Chemical and Sinopec each plan to export 100,000 mt, 40,000 mt and 30,000 mt of gasoline in August, respectively.

Asian gasoil/diesel markets were largely rangebound July 26, with sentiment pulled in opposite directions as rising coronavirus infections in Southeast Asia dented the demand outlook, while spot supply from North Asia was seen to be curtailed for August.

o The upsurge in COVID-19 infections has prompted several countries to announce extensions to coronavirus-related lockdowns and extend restrictions to cover wider areas, moves that were widely expected to dent overall gasoil demand.

Even as Asia braces for deepening demand destruction for gasoil/diesel, the market has strengthened during the week due to thin supply from North Asia, offsetting sluggish demand.

o China’s oil companies plan to further slash exports of key oil products to a six-year low of 1.07 million mt in August due to limited export quota availability.

FOREX: Philippine peso depreciated week-on-week against the US dollar by P0.02 to P50.33 from P50.31 previous week.

DOMESTIC OIL PRICES

Effective 03 August 2021, the oil companies implemented a price increase in domestic oil products, i.e. P1.05 per liter for gasoline, P0.75-P0.80 per liter for diesel and P0.75 per liter for kerosene.

These resulted to the year-to-date adjustments to stand at a total net increase of P13.90/liter for gasoline, P11.10/liter for diesel and P9.45/liter for kerosene.

For the updated prevailing retail pump price, please browse this link: https://www.doe.gov.ph/price-monitoring-charts?q=retail-pump-prices-metro-manila.

For more information, call the

Department of Energy
Pricing: 840-2187
LPG: 840-2130
Fuels: 840-5669
SMS: (0915) 4469421
Email: oilmonitor@doe.gov.ph
Website: https://www.doe.gov.ph