July 2023 – PIP – Philippine Institute of Petroleum

WORLD OIL PRICES (July 10-14, 2023, trading days)

The week-on-week price of Dubai crude has increased by around $3.80/bbl. MOPS gasoline, diesel and kerosene have also increased by about $5.50/bbl, $5.60/bbl and $5.20/bbl, respectively. These movements were based on the same comparative week.

Reasons for the Price Adjustment¹

Oil prices rallied this week, as market sentiment received a boost from China’s latest trade data showing a 45.3% on-year jump in its crude imports in June, suggesting healthy downstream demand and profitable refining margins.

Meanwhile, a low US Consumer Price Index report for June stirred optimism that inflation was easing, though the data alone was not expected to sway the US Federal Reserve’s decision on interest rates at its July 26 meeting.

A drop in US dollar to its lowest value since April 2022 against a basket of currencies also supported dollar-denominated oil futures.

On the demand side, the International Energy Agency on July 13 cut its 2023 oil demand growth estimate by 220,000 b/d to 2.2 million b/d due to macroeconomic headwinds while raising its 2024 demand growth forecast by 290,000 b/d. China is expected to account for 70% of global demand growth in 2023.

Asian gasoline crack rebounded, tracking a stronger US RBOB-Brent crack, despite some easing of US domestic gasoline demand, in the recent week. Rains and flooding in the US Atlantic Coast region was said to have caused dampening demand.
Asian gasoil/diesel crack has strengthened despite of an expected jump in China’s gasoil exports in July.

o Gasoil outflows from China are expected to be around 1.2-1.5 million mt in July, higher than earlier expectations of 800,000-900,000 mt, and up from estimates in June.

In Korea, refiners are said to be holding back on some current exports, as they waited for the government update on whether retail fuel tax cuts will be extended beyond August. The tax cuts were enacted in late 2021 to temper a spike in international oil prices..

FOREX: The week-on-week average of Philippine peso appreciated versus the US dollar by P0.39 to P55.00 from P55.39 in previous week.

DOMESTIC OIL PRICES

Effective 18 July 2023, the oil companies implemented an increase of P1.90/liter for gasoline, P2.10/liter diesel and P1.80/liter for kerosene.

These price adjustments resulted in a year-to-date net decrease of P0.85/liter for diesel and P3.70/liter for kerosene. Gasoline, on the other hand, has a net increase of P7.55/liter.

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

For more information, call the

Department of Energy
Pricing: 840-2187
LPG: 840-2130
Fuels: 840-5669
Website: https://www.doe.gov.ph

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¹ Asia-Pacific Weekly Recap 14 July 2023 by S&P Global Commodity Insights