Up to P1.50/L fuel price hike possible next week

MANILA, June 27 ------ With fuel prices remaining volatile, domestic prices are projected to increase by as much as PHP1.50 per liter next week based on the price developments, an oil firm executive said.

Jetti Petroleum Inc. president Leo Bellas, in a message to journalists Friday, said diesel prices may likely decrease by as much as PHP0.70 per liter but may also be increased as much as PHP1.20 per liter. Gasoline prices are also projected to be slashed by as much PHP0.50 per liter but may also possibly be hiked by as much as PHP1.50 per liter.

Bellas explained that “world crude oil prices have eased down, despite the tempered optimism over the US-Iran interim peace deal and ongoing negotiations, on improving broader supply outlook as physical flows through the Strait of Hormuz gradually recovers, and the return of disrupted Middle Eastern barrels as Gulf producers ramp up production.” Sanctions waiver on Iranian oil also negatively impact on prices, he said, noting that this “will allow Iran-origin crude oil and other petroleum products into the market.”

On the other hand, Bellas said “Asian diesel and middle distillates price benchmarks are relatively weaker as the market is expecting a gradual rise in regional availability.” He said “refiners have been maximizing distillates output and the prospect of a fresh wave of supply of Middle Eastern crude are seen to pressure diesel and middle distillate prices.” He also cited that “fundamentals in the global gasoline market is expected to remain tight due to high seasonal demand despite the prospect of recovering crude and product flows.”

He said “firm demand from Indonesia while Chinese exports stay limited due to current export restrictions will continue to support Asian gasoline prices.” He pointed out that “despite the political agreement, physical flows through the Strait and shipping activity have yet to normalize.” “Uncertainty still remains over the durability of the US-Iran accord. The recent incident of a suspected attack on a cargo vessel in the Strait of Hormuz has reignited fears that the preliminary deal would not hold,” he added.

Source: pna.gov.ph