April 2022 – PIP – Philippine Institute of Petroleum

WORLD OIL PRICES (April 4-8,2022 trading days)

Dubai crude has decreased week-on-week by roughly US$6.00/bbl. MOPS gasoline and MOPS diesel have both dropped by about US$2.00 per barrel and US$ 0.40 per barrel, respectively.

Reasons for the Price Adjustment¹

Prices started again to retreat after ban on Russian energy faced opposition in the European Union (EU). The fall was also supported after US EIA data released late-April 6, showing that crude stocks in the country ballooned 2.42 million barrels in the week ended April 1 to 412.37 million barrels. This came as US crude output rose 100,000 b/d to 11.8 million b/d, marking its highest level since December 2021.
- Prices fell sharply with crude futures trading mid-day on April 7 below $100/b for the first time after March 17 as the IEA announced that member countries have agreed to release 120 million barrels of oil from storage, which includes 60 million barrels from the US, which makes the total SPR release around 240 million barrels
Gasoline demand in Asia stayed put amid increased driving activity in the region. For instance, Indonesia has loosened travel restrictions for the Ramadan festival, Malaysia has opened its borders on April 1 for international travelers amid rising tourism demand, and gasoline demand in Vietnam was also supported by cuts to environmental protection tax rates intended to combat high fuel prices.
The Asian gasoil/diesel market kicked off the week of April 11 with a flurry of tender activity, reflecting a strong selling interest from Asian producers with surplus barrels amid robust product cracks.
Strong product cracks for gasoil continued to incentivize refiners in Asia to maximize its yield and channel excess barrels into the export market, further supported by the steep backwardation in the gasoil market structure discouraging the storage of barrels.

FOREX:Philippine peso appreciated week-on-week against the US dollar by P0.56 to P51.40 from P51.96 in previous week.

DOMESTIC OIL PRICES

Effective 12 April 2022, the oil companies implemented a price decrease in domestic oil products. Gasoline has dropped by P1.00 per liter, diesel by P0.35 per liter, and kerosene by P3.00 per liter.

These resulted to the year-to-date adjustments to stand at a net increase of P15.00/liter for gasoline, P25.65/liter for diesel and P21.10/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

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¹ Asia Pacific Weekly Recap by S & P Global Platts Analytics

Source: DOE Website

WORLD OIL PRICES (March 28-April 1,2022 trading days)

Dubai crude has decreased week-on-week by roughly US$ 4.50/bbl. MOPS gasoline and MOPS diesel have both dropped by about US$6.50 per barrel and US$ 5.30 per barrel, respectively.

Reasons for the Price Adjustment¹

Crude prices slid earlier this week as the Russian and Ukrainian negotiators met in Turkey to discuss cease fire agreement on March 28. Russia promised to cut down heavily on military near Kyiv while Ukraine proposed a neutral stance on security guarantees. However, talks failed to materialize and crude prices surged in response.
- However, announcement by Biden administration to release 180 million barrels over 6-month period or 1 million b/d of oil from strategic petroleum reserves (SPR) caused crude prices to slump by more than$5/band even overshadowed bullish US inventory data and stalled progress on Russia-Ukraine peace talks.
- OPEC+ in its meeting on March 31 decided to stick to scheduled production increase of 432,000 b/d for May, in line with market expectations and leaving little impact to oil markets.
Asia gasoline market slipped further this week with cracking falling by $2.61/b on week to $14.15/b on March 31 Asian close as markets see higher exports from China and India. According to market sources, China is expected to export about 500,000-700,000 mt of gasoline in April as domestic demand weakens on re-imposition of lockdowns in several cities including Shanghai.
- S&P Global Commodity Insights has lowered China’s gasoline demand by 400,000 b/d in March and 250,000 b/d in April due to renewed restrictions. Indian sellers were also heard increasing exports in April from March.
- Upcoming Ramadan and higher driving season would further support higher driving activity and gasoline demand.
Given the high dependency of EU on Russian diesel, that receives roughly 0.7 million b/d of diesel from Russia, the gasoil market reacted strongly last week on news on potential ban by EU of Russian oil imports. However, prices fell precipitously as Russian diesel continues to flow into Europe with Asian gasoil cracks tumbling by $5.19/b on week $32.57 on March 31 Asian close.
- With shortage concerns have subsided, the tighter fundamentals however, still remain at play. Demand remains strong as economies continue to live with virus while regional supply remains tight.

FOREX:Philippine peso appreciated week-on-week against the US dollar by P0.39 to P51.96 from P52.35 in previous week.

DOMESTIC OIL PRICES

Effective 05 April 2022, the oil companies implemented a price decrease in domestic oil products. Gasoline has dropped by P2.30-P2.50 per liter, diesel by P1.85-P2.00 per liter, and kerosene by P1.65 per liter.

These resulted to the year-to-date adjustments to stand at a net increase of P16.00/liter for gasoline, P26.00/liter for diesel and P24.10/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

_______
¹ Asia Pacific Weekly Recap by S & P Global Platts Analytics