PNOC to buy 2 million barrels of diesel

MANILA, Philippines, March 19 ------ The Philippine National Oil Co. (PNOC) has begun procuring two million barrels of oil from the global market to shore up the country’s fuel reserves, Finance Secretary Frederick Go said.

Go told reporters the additional supply is equivalent to 10 days of buffer stock. “The PNOC-EC has already started the procurement process and we should be able to procure about two million barrels of oil anytime now to dispel fears that we will have an oil shortage,” he told the InvestPH conference in Taguig City. This was also double the one million barrels initially planned. The finance chief said supply will arrive in batches and could come “anytime this week.” He said a more prudent approach is to source from multiple suppliers.

The Philippines, which mostly procures its supply from South Korea, Japan, Singapore and China, has approached Russia to negotiate a possible supply contract. The United States recently suspended its sanctions on Russian oil exports. Energy Secretary Sharon Garin earlier said the Philippines currently has sufficient fuel inventory until April.

Last Sunday, Go and Garin met with 16 oil companies to explore emergency measures aimed at acquiring oil at lower prices and broadening the country’s sourcing network. Asked whether the move would help ease prices or focus more on supply, Go said it would likely achieve both. ”The primary objective, of course, is to create that buffer stock, additional buffer stock. And also when you put out a big order into the global market, the beneficiary should be able to get some economies of scale and procure at lower prices,” he said. Go added that the Bangko Sentral ng Pilipinas may need to tighten monetary policy in its next meeting if oil prices continue to rise due to the US-Israel war on Iran. “If oil prices remain high, if oil prices remain elevated and the situation persists for some time, the Monetary Board most likely will have to entertain a tightening,” he told reporters.

Source: philstar.com