pip_admin – Page 4 – PIP – Philippine Institute of Petroleum

Posted on: April 6, 2022 by pip_admin

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

Posted on: January 6, 2022 by pip_admin

Source: DOE Website

WORLD OIL PRICES (December 27-31, 2021 trading days)

Dubai crude has increased week-on-week by almost US$4.75/bbl. Both MOPS gasoline and MOPS diesel have also increased: gasoline by around US$ 4.60 per barrel and diesel by nearly US$ 5.60 per barrel.

Reasons for the Price Adjustment

Oil is lower in the Asian session, with volatile price movements in the final sessions of the year likely attributable to Covid-19 concerns. Analysts foresee easing prices in the first quarter of the year behind expectation of modest inventory build, but will likely rise once lockdowns due to the Omicron variant of Covid-19 cease or become less frequent as the winter ends.
Crude prices remained under pressure as renewed omicron concerns pervaded the market. The fast-spreading variant triggered several countries to make tighter measures and raised concerns of lockdowns.
Asian gasoline complex remained healthy with omicron impact still not visibly noted in the mobility metrics tracked by Apple that continue to remain robust across all Asian nations.

In the Asian gasoil/diesel market, fundamentals remained strong even as regional supply length increased due to closed East-West arbitrage lanes and higher gasoil exports from China this month.

Singapore’s gasoil exports fell 71.92% week on week to 107,731mt over Dec. 23-29. Outflows were highest to Indonesia at 39,066 mt, followed by Myanmar and Malaysia at 35,161 mt and 17,190 mt, respectively.

FOREX: Philippine peso depreciated week-on-week against the US dollar by P0.53 to P50.54 from P50.01 in previous week.

DOMESTIC OIL PRICES

The domestic price increases for the week were attributed by the week-on-week increase in MOPS. The depreciation of Peso also added to the impact of the volatile MOPS.

Effective 04 January 2022, the oil companies implemented a price increase in domestic oil products. Both gasoline and kerosene have increased by P1.85 per liter while diesel has increased by P2.40 per liter.

These are the first price adjustment for the year. In 2021, prices had a total net increase of P17.65/liter for gasoline, P14.30/liter for diesel and P11.54/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

Posted on: October 25, 2021 by pip_admin

Source: DOE Website

WORLD OIL PRICES (October 11-15, 2021 trading days)

Dubai crude has increased week-on-week by almost US$3.00/bbl. MOPS gasoline and MOPS diesel have also increased by nearly US$5.25 per barrel and around US$ 3.80 per barrel, respectively.

Reasons for the Price Adjustment

Following US DOE’s announcement of not releasing additional crude stocks from its Strategic Reserve, the oil market again shifted its focus on tight supply and improving oil demand. The improving COVID-19 situation, easing of mobility restrictions and re-opening of borders by many countries fueled the prospects of higher oil demand.
Gas to oil switching from utilities and industrial sectors amid a broader rally in the energy commodities space also continues to boost crude oil demand.
Larger than expected build in US crude oil stocks of 6.09 million barrels to 426.98 million barrels for the week ending Oct.14 failed to weigh on market sentiment. Thus, crude oil prices continued the uptrend with US benchmark-WTI prices breached $80/bbl for the first time since 2014 and Europe’s ICE Brent front month futures rose to $84/b on Oct.14 Asian close.
Asian gasoline fundamental continues to tighten on uptick in regional demand amid ongoing supply tightness. Declining coronavirus cases, higher vaccination rates and upcoming string of festivals continue to propel Indian gasoline demand while re-opening of borders and resumption of interstate travel in Thailand and Malaysia, respectively, added to bullish market sentiment.

o Lower gasoline exports from China that are likely to persist through Q4 continues to tighten the Asian gasoline market.

&ZeroWidthSpace;&ZeroWidthSpace;&ZeroWidthSpace;&ZeroWidthSpace;Supply squeeze amid robust arbitrage economics to send gasoil/diesel barrels to the West continue to support low sulphur gasoil market while medium sulphur grade sees steady recovery from Southeast Asia.

o Market estimates though see China’s October gasoil exports are likely to fall 47% month on month on reduced export quotas and strong domestic market.

FOREX: Philippine peso depreciated week-on-week against the US dollar by P0.01 to P50.70 from P50.69 in previous week.

DOMESTIC OIL PRICES

Effective 19 October 2021, the oil companies implemented a price increase in domestic oil products, i.e. P1.80 per liter for gasoline, P1.40-P1.50 per liter for diesel and P1.30 per liter for kerosene.

These resulted to the year-to-date adjustments to stand at a total net increase of P19.65/liter for gasoline, P18.00/liter for diesel and P15.49/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

Posted on: October 25, 2021 by pip_admin

A number of House Bills (HB4550, HB4711, HB5172 and HB7928) have been filed in Congress that intends to repeal or amend certain provision of the Downstream Oil Deregulation Law (RA 8479).

With reference to the House Committee on Energy hearings on the subject matter, the Philippine Institute of Petroleum (PIP) has manifested the following points to the Congress:

Local oil price movements follow the trend of international oil price movements. Street level pricing or retail pricing on the other hand, is ultimately determined by competition in the particular location as all retailers (dealers) will always want to stay competitive with neighboring retail stations. Healthy competition brings with it a natural check and balance.
The Oil Deregulation Law (RA 8479) has brought tremendous benefits to the oil industry.

The dominant market shares enjoyed by the so called big three oil companies pre-oil deregulation has now been broken up by the entry of numerous oil companies. As of 2019 data there are about 9,003 retails stations in the entire country. Of the total 9,003 retails stations, about 3,736 (41%) are oil majors and 5,267 (59%) are new players.
Deregulation brought about competition which saw the introduction of better-quality products, better retail station facilities and services, innovative promotions and also intense price discounting. Consumers enjoyed increased power of choice.
Deregulation lowered the industry’s barrier to entry and has given business opportunities to thousands of local entrepreneurs who have opened retail stations. This also saw the related growth of allied service providers like contractors, equipment suppliers and provided an efficient route to market for various non fuel products now sold in retail stations;
Regulation and/or Price Control will always diminish the attractiveness of an industry and can discourage potential new investments. This can be from the opening of new retail station by entrepreneurs, job creation for service providers and even to the entry of new oil companies.;
A deregulated industry brings about a more buoyant competitive market environment. It also stimulates investments and job creation. Consumers benefit from increased power of choice, better quality products and a safer and pleasant refueling experience.

The government should continue focusing on promoting more competition, attracting more new players, encouraging more innovations as this will ultimately redound to an even heightened competitive environment that will impact pricing and quality of products and services.

PIP’s Position on the Oil Price Movements

Below are some of the comments and position of PIP pertaining to oil price movements and competition:

The weekly oil price movements announced by the downstream oil companies, whether an increase or decrease, will follow the trajectory of global/regional oil pricing as revealed in the Mean of Platts Singapore (MOPS). We deny the assertions that oil companies are quick to reflect oil price increases but is not too quick in reflecting price decreases;
There are many factors that influence international oil prices. Primary will be supply and demand and geo-political tensions. The onset of the COVID-19 pandemic caused a global slump in demand thus oil prices went down significantly. Now that some countries are opening up, and economies starts recovering, demand for fuel is increasing thus we see increases in fuel prices;
Given the deregulated nature of the industry, street level competition is the ultimate determinant of prices thus the retailers are given certain latitude to adjust their prices to match/beat competition in order to be competitive;
Many oil companies, including members of the Philippine Institute of Petroleum has challenged the legality of DOE’s DC2019-005-008 that mandates the unbundling of pricing components. This goes contrary to the Oil Deregulation Law and it jeopardizes the oil companies many trade and marketing secrets. This will also cause the oil companies to violate their non-Disclosure agreements with their various suppliers of products and services;
The pricing disparity in Baguio versus that of Rosario, La Union is influenced by many factors such as competition, cost of doing business and logistical considerations but is caused primarily by comparing Baguio prices to a location where intense price competition is happening (Rosario, La Union);

Posted on: October 25, 2021 by pip_admin

Technology Solution Retail Outlets (TSRO), are commonly known as Fuel Vending Machines that addresses the fuel requirement of locations certified by LGU’s to be catered by the “bote-bote” (soda bottles) trade.

The “bote-bote” retailing of fuel is deemed dangerous to the health and safety of both the consumer and the retailer plus the source and quality of the fuel being sold cannot be ascertained to be compliant to the prescribed standards.

TSROs, like the fuel retailing outlets are also governed by the DOE’s Retail Rules (DC2017-11-0011), which specifically stipulates under Rule IV b. TSRO, the list of requirements for compliance:

Secure Certificate of Endorsement from LGU – Certifying that a TSRO intends to address the “bote-bote” retailing in the area being applied for;
Secure Certificate of Compliance (COC) from DOE;
Observance of 1 kilometer radius from another Retail Outlet;
No other commercial establishment shall installed/constructed with the Retail Outlet rather than those necessary for its operation;
The vehicle being serviced and the delivery of the liquid fuels by the tank truck shall at all times be inside the business premises;
One (1) meter set back distance shall be maintained in (a) the cashier’s boots or dispensing pump to firewalls and (b) tank trucks to firewalls (during supply operations).

Moreover, the DOE issued an Addendum to the Rule IV b. which allows a maximum of 2000 liters capacity for above ground storage tank (both for gasoline and diesel) that is petroleum compatible except plastic (HDPE) and appropriately protected with no visible mark of corrosion. In addition, display of price and volume (in liters) should be present for dispensing pumps that should be equipped with safety breakaway couplings and a petroleum compatible hose not to exceed 5.5 meters. Additionally, automatic shut off nozzles must also be present in the dispensing pumps.

TSROs are reportedly growing in several areas across the country. According to reports, there are more than 200 TSROs operating in Oriental Mindoro and MIMAROPA (Marinduque, Romblon, Palawan). Expansion areas reportedly includes Region 6 – Western Visayas consisting of 6 provinces namely Aklan, Antique, Negros Occidental, Capiz, Guimaras and Iloilo.

PIP Position

PIP supports the government initiatives to counter the “bote-bote” or soda bottle trading of fuel as this practice is unsafe and product quality is not assured. Additionally, TSROs provide business opportunities and employment to small and medium sized entrepreneurs in the locations where they operate.

However, TSROs should also be supervised and monitored to ensure equal compliance to the DOE’s Retailing Rules and other government regulations to ensure safety and a level playing field. In summary, PIP has expressed concerns on the following:

Health and Safety;
Proliferation of TSROs in non “bote-bote” areas; and
Level playing field.

On health and safety concerns, PIP has recommended that above-ground storage for 2000 Liters should be reconsidered as the Fire Code only allows a maximum of 454 liters with each container not exceeding 227 liters. Above ground storage of fuel also requires a special concrete enclosure with mandated set back requirements from potential sources of ignition and nearby structures. In addition to this, the use of reconditioned drums should also be prohibited as their integrity cannot be ascertained.

There are reported cases already that TSRO’s are seen being established in urban locations. There are online advertisements of TSRO equipment being offered at a discount for Metro Manila and surrounding locations. The DOE in a recent forum admitted that their official records as of September only shows a very limited number of Certificate of Compliance being given to TSRO’s and that the Fuel Vending Machines does not have any local certifying mark like the PS mark which can attest to its quality and safety.

PIP has always advocated for a level playing field amongst all players, whether these are TSRO’s, Marine Outlets and the regular fuel retail outlets. TSRO’s should also be monitored for compliance to BIR registration and issuance of receipts, compliance with fuel marking certificates and bio fuel laws, compliance to the stringent requirements of the Department of Energy’s (DOE) Certificate of Compliance (CoC) and reportorial requirements and to the safety standards mandated by the Bureau of Fire Protection’s (BFP) Fire safety inspection and certificate.

A level playing field promotes investments, fair & healthy competition, consumer safety and tax generation for the government. Government efforts should be intensified to ensure that all abide by the rules and regulations in place, whether they are TSRO’s or regular retail fuel outlets.

Posted on: August 4, 2021 by pip_admin

Source: DOE Website

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

Posted on: July 5, 2021 by pip_admin

Source: DOE Website

WORLD OIL PRICES (June 21-25, 2021 trading days)

Dubai crude has increased week-on-week by around US$1.00/bbl. MOPS gasoline and diesel have also increased by almost US$2.30 and US$0.95 per barrel, respectively.

Reasons for the Adjustment

Prices of Oil climbed to their highest since October 2018 on expectations that demand growth will exceed supply, and OPEC+ will be careful in returning more crude to the market from August.
The markets are in strong anticipation for the OPEC+ to meet on July 1 to discuss the further easing of their output cuts starting August. Most analysts feel the producer group has ample space to boost supply without disrupting the drawdown in oil stocks, given the greatly improved demand outlook.
- The key factors OPEC+ reportedly consider are the strong demand growth in the US, Europe, and China, bolstered by vaccine rollouts and reopening economies.
- Reports disclosed that OPEC+ is currently holding crude production at 6.2 million b/d (MMB/D), below October 2018 levels and intends to taper this output cut to 5.76 MMB/D in July.
The prospect on the lifting of Iran sanctions, which was expected to add up supply to the market has dimmed, reportedly due to issues in relation to Tehran’s compliance with the 2015 nuclear deal.
Crude oil futures settled higher as the market eyed increasingly bullish supply and demand outlooks despite the rapidly spreading coronavirus delta variant.
Demand recovery, buoyed by the decline in the number of COVID -19 cases and an uptick in vaccination, has boosted the market’s ability to absorb additional supplies.
- Market analysts noted that even with the increased output, the oil market could remain tight in the near-term owing to the increased travel and strong economic growth in the US and Europe.
The Asian gasoline market ended the week slightly firmer, lifted by a stronger US- RBOB crack¹, which went on to record a 10 -session high during Asian trade hours.
- The US stock draw comes as total product supplied for gasoline climbed to a four-week-high 9.44 MMB/D, testing highs last seen in February 2020 prior to the first wave of pandemic lockdowns.
- Gasoline cracks also moved upwards with ongoing refinery outages that are expected to impact gasoline.
Asian gasoil/diesel market fundamentals were largely unchanged, with participants continuing to evaluate the demand-supply situation.
- The Asian gasoil complex was largely steady from the previous session amid an absence of fresh price signals after a rough trajectory earlier in the week saw the front month structure flip from backwardation ² to contango³.
- Some participants foresee a bullish market on hopes that narrowing supply balances would inject some strength, while others anticipate the market values reflecting the lackluster demand in the region.

¹ Crack – is an industry term for breaking apart crude oil into the component products, including gases like propane, heating fuel, gasoline, light distillates, like jet fuel, intermediate distillates, like diesel fuel, and heavy distillates, like grease.
² Backwardation – is when the current price, or spot price, of an underlying asset is higher than prices trading inthe futures market.
³ Contango is a situation where the futures price of a commodity is higher than the spot price.

FOREX: Philippine peso depreciated week-on-week against the US dollar by P0.57 to P48.71 from P48.13 in previous week.

DOMESTIC OIL PRICES

Effective 29 June 2021, the oil companies implemented a price increase in domestic oil products. Gasoline has increased by P1.00 per liter, P0.65 per liter for diesel and P0.70 per liter for kerosene.
These resulted to the year-to-date adjustments to stand at a total net increase of P11.75/liter for gasoline, P9.90/liter for diesel and P8.40/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

Posted on: June 9, 2021 by pip_admin

Source: DOE Website

WORLD OIL PRICES (May 31-June 4, 2021 trading days)

Dubai crude has increased week-on-week by almost US$2.40/bbl. MOPS gasoline and diesel have also increased by around US$0.85 and US$2.00 per barrel, respectively.

Reasons for the Adjustment

Oil prices rose to a two-year high on stronger demand prospects, as OPEC+ succeeded in draining global oil inventories and the successful rollout of vaccine programs continued.
- Plans to gradually increase production in July were already factored into oil prices ahead of the OPEC+ meeting, driven by expectations that recovering summer travel demand and the reopening economies will easily accommodate the gradual increase.
- OPEC+ output cuts also helped to offset significant second-half stock draws, which is a strong bullish factor supporting an extremely tight market ahead, amid post-pandemic optimism about rising oil demand in the US, China and Europe.
- While Brent crude price finally rose above the $70 mark amid tighter oil market prospectsanalysts said it is not yet clear if the crude would move higher to make the $70 mark a base level.

With the OPEC+ June 1 meeting, the group still forecasts a 6 million bpd (MMBD) increase in oil demand in 2021, equivalent to 6% of global consumption, as the world recovers from the COVID-19 pandemic.¹
- OPEC+ cut output by a record 9.7 MMBD last year as demand collapsed when the COVID-19 pandemic first struck.
- In the recent meeting, OPEC+ agreed to stick to the existing pace (agreed on April 9) of gradually easing supply curbs through July.
- OPEC+ decided in April 2021 to return 2.1 MMBD of supply to the market during May through July as it anticipated demand would rise despite high numbers of coronavirus cases in India.
- Thus, supply curbs will still in place to stand at 5.8 MMBD by July.

At the recent OPEC+ ministerial meeting, OPEC officials downplayed the potential impact of the lifting of Iran nuclear deal.²
- Platts also stressed its minimal impact on supply balances.
- The resulting deal could add over 1.1 MMBD of additional Iranian exports onto the market by year-end.
- Prices gained even with as US and Iran continues to talk towards a new nuclear deal that is expected to lift current sanctions on Iran’s oil exports.

In Asia, an influx of gasoline cargoes from non-Chinese sources increased the light distillate inventories in the city-state to its highest in four months in the week ended June 2.
- Enterprise Singapore data showed light distillate stocks up by 8.73% to 13.615 mill barrels amid the spike in gasoline inflows from South Korea and India.
- More spot tenders from oil companies were seen offering 92 RON gasoline for loading next month-June.

The Asian gasoil/diesel complex ended the trading week with higher prices amid expectations of a tightening regional supply balance due to reduced spot availability from China.
- Outflows of supply from the key exporter-China was reduced as Chinese refiners shift their focus to fulfil domestic requirements following the new levies imposed on blendstocks including light cycle oil effective June 12.
- The scheduled refinery turnarounds and reduced run rates at several refineries in the region in response to poor domestic and international demand also resulted to limited supply inflows into Singapore.
- Asia’s main trading hub in Singapore saw commercial middle distillate stocks falling 7.9% week on week to 11.47 million barrels over May 27-June 2, marking its lowest in 15 months, according to data released by Enterprise Singapore late on June 3.

FOREX: Philippine peso appreciated week-on-week against the US dollar by P0.28 to P47.76 from P48.05 in previous week.

DOMESTIC OIL PRICES

Effective 08 June 2021, the oil companies implemented a price increase in domestic oil products. Gasoline has increased by P0.20 per liter, diesel by P0.55 per liter and P0.60 per liter for kerosene.

These resulted to the year-to-date adjustments to stand at a total net increase of P9.50/liter for gasoline, P8.15/liter for diesel and P6.70/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

_______

¹www.reuters.com/business/energy
² S & P Global Platts’ Asia Pacific Weekly Recap dated 04 June 2021

Posted on: May 3, 2021 by pip_admin

Source: DOE Website

WORLD OIL PRICES (April 19-23, 2021 trading days)

Dubai crude has increased week-on-week by almost US$1.00/bbl. Both MOPS gasoline and MOPS diesel have also increased: gasoline by around US$1.40 per barrel and diesel by nearly US$1.00 per barrel.

Reasons for the Adjustment

The sour crude market showed signs of cooling amid rising concerns over India’s worsening COVID-19 situation, as the country’s oil demand is hit by second wave of infections and restriction measures. However, second half recovery remains in sight amid widening vaccination rollout.
- S&P Global Platts Analytics has lowered India’s oil demand growth forecast to 400,000 b/d in 2021 (versus 440,000 b/d last month), with 2021 demand to remain below 2019 levels.
- The main reasons behind the mild downward revision were: 1) the government of India has no intention to repeat last year’s strict nationwide lockdown and 2) India reportedly has a substantial vaccine production capacity that allows it to administer 130 million shots so far, or about 10% of the total population.
- Thus, the availability of vaccines will likely lead the government to defer from tough suppression measures, which is positive for oil demand.
On supply above OPEC+, the US oil production level of 12.8 million b/d (MMB/D) in December 2019 is not expected to be achieved again before late-2023.
- The severe reduction in drilling and completion activity due to the pandemic coupled with capital discipline is requiring four years for production to reach pre-COVID-19 levels.
- Longer term production growth (beyond 2023) is dependent on several factors including global demand, well-level break-evens, capital discipline, and shale rock quality.
- Forecast is predicted at $49/b WTI (constant dollars); variations in prices will result in changes in predictions.&ZeroWidthSpace;
For gasoline in Asia, reports disclosed of strengthened gasoline market toward the end of the trading week with the increasing Dubai-gasoline crack spreads amid support for fundamentals from fresh buy tenders.
- Gasoline markets were sustained by fresh demand from Indonesia. Pertamina bought six parcels of 200,000 barrels each for delivery over May and June via tender while also seeking an additional 350,000 barrels of prompt deliveries for end-April/early-May.
- Prices showed no sign of COVID-related demand concerns from rising infection numbers in India and Japan.&ZeroWidthSpace;
Gasoil/diesel cracks inched higher despite the re-emergence of COVID-related demand fears. The Singapore gasoil vs. Dubai crack reached a seven-week high of $6.16 per barrel.
- The main concern centered on India, where daily COVID infections have surged to 300,000 cases, about 200% higher than the peak during 2020 that lead to overloaded health care system sand localized lockdowns in some areas.
- Indian gasoil demand had been on a strong recovery track, back to 1.73 MMB/D or 97% of 2019 levels in 1Q 2021. The second quarter is usually a strong period for agricultural gasoil demand, which should see a limited impact as lockdown measures are so far confined to cities.
- While the country’s gasoil demand is likely to deteriorate further from the 3% month-on-month decline in first half of April, the government is not repeating last year’s strict national-level lockdown. Thus, Platts Analytics conclude that a repeat of last year’s sharp demand contraction is not expected.&ZeroWidthSpace;

FOREX: Philippine peso appreciated week-on-week against the US dollar by P0.12 to P48.37 from P48.50 in previous week.

DOMESTIC OIL PRICES

Effective 27 April 2021, the oil companies implemented the price increase in domestic oil products. Gasoline has increased by P0.45 per liter, diesel by P0.35 per liter and kerosene by P0.65 per liter.

These resulted to the year-to-date adjustments to stand at total net increase of P7.60/liter for gasoline, P5.70/liter for diesel and P4.95/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

Posted on: April 6, 2021 by pip_admin

Source: DOE Website

WORLD OIL PRICES (March 29-April 02, 2021 trading days)

Dubai crude has increased week-on-week by about US$0.60/bbl. Both MOPS gasoline and MOPS diesel have also increased by around US$2.00 and US$0.25 per barrel, respectively.

Reasons for the Adjustment

On the 15th ministerial meeting on 01 April 2021, it was agreed that OPEC+¹ will raise production by 350,000 b/d in May and June, and 400,000 b/d in July for a cumulative increase of 1.1 million b/d.²
- In parallel, Saudi Arabia will phase out most of its additional cuts by end-July, raising production by 250,000 b/d in May, 350,000 b/d in June and 400,000 b/d in July.

OPEC+ has chosen a middle course by opting to increase supply but doing so in a staggered manner. It has also removed uncertainty from the market over what is likely to be a period of accelerating demand over the summer.
- Platts Analytics sees global oil demand accelerating by over 7.2 MMB/D over the May-July period led by an accelerating recovery in the US.
- Notwithstanding the OPEC+ decision, Platts Analytics continue to see global balances as conducive to higher prices and stock draws over the next few months.

The Asian gasoline market was supported on the first trading day of April, with crack spreads hovering near 13-month highs as a US gasoline stock draw continued to fuel optimism in the overall development.
- The sustained strength in Asian gasoline comes as bullish news from the West on late March 31, following data released from the US Energy Information Administration that showed a 1.74 million-barrel stock draw in US gasoline inventories.
- Unplanned regional outages were also fuelling bullish sentiment in Asia.
  - Indonesia’s 125,000 b/d Balongan refinery was reported to have only extinguished the fires at its facility late March 31, with a total of four of the refinery’s 72 storage tanks having been affected by the incident. A total of 100,000 kiloliters of capacity had been lost in the fire that broke out on March 29.
  - In Japan, all units at ENEOS Wakayama (127,500 b/d) were shut following a fire incident on March 29. The fire started at a 39,000 b/d fluid catalytic cracker unit (FCC), which could impact gasoline and naphtha output. The fire was extinguished quickly, but there are no details yet for a restart.
- Asian gasoline was also supported by reports that several ships had been placed on subjects to move gasoline out from the Middle East to Western and African destinations.

On Diesel, the removal of the Suez Canal blockage will relieve some pressure as the flow from India and the Middle East to Europe will now resume.
- However, the incident could have a continued impact as displacements caused by ships delayed or rerouted around the Cape of Good Hope result in higher freight rates and reduced vessel availability through April and May.
- According to Platts data, rates for the West India and Arab Gulf to UK Continent routes are currently at a 10-month high. Higher freight costs make already unfavorable East-West arbitrage economics even less attractive. This, in turn, has resulted in Asian gasoil barrels remaining stuck within the region even as demand plateaued.

FOREX: Philippine peso appreciated week-on-week against the US dollar by P0.11 to P48.50 from P48.61 in previous week.

DOMESTIC OIL PRICES

Effective 6 April 2021, the oil companies implemented the price increase in domestic oil products. Gasoline has increased by P0.65 per liter while diesel and kerosene also increased by P0.05 per liter.

These resulted to the year-to-date adjustments to stand at total net increase of P6.80/liter for gasoline, P4.65/liter for diesel and P3.55/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 OPEC+ is a group of 24 oil-producing nations, made up of the 14 members of the OPEC, and 10 other non-OPEC members, including Russia.
² The Meeting emphasized the ongoing positive contributions of the Declaration of Cooperation (DoC) in supporting a rebalancing of the global oil market, in line with the historic decisions taken at the 10th (Extraordinary) OPEC and non-OPEC Ministerial Meeting on 12 April 2020 to adjust downwards overall crude oil production, and subsequent decisions.