Oil firms to hike diesel, gasoline prices this week

MOTORISTS should brace for higher pump prices this week as fuel retailers pause rollbacks amid rising logistics and insurance costs due to the prolonged conflict in the Middle East.

Department of Energy (DoE) Secretary Sharon S. Garin on Monday said oil companies must implement a price hike of not more than P2.66 per liter for diesel and P2.21 per liter for gasoline.

The rollback in the price of kerosene on the other hand, should be capped at P3.53 per liter, Ms. Garin said.

Ms. Garin said the global oil market has been calming down compared with the previous weeks.

In line with the DoE guidance, Seaoil Philippines, Inc. and Petron Corp. announced they would raise prices by P2.21 per liter for gasoline and P2.66 per liter for diesel starting Tuesday. The firms will lower kerosene prices by P3.53 per liter.

On the other hand, Jetti Petroleum, Inc. is set to hike the price of gasoline by P2.20 per liter and diesel by P2.60 per liter.

The Energy chief said the peso depreciation added upward pressure on oil prices.

On Monday, the peso closed at P61.565 per dollar, weakening by eight centavos from its P61.485 finish on Thursday. This is just a tad stronger than the peso’s record-low close of P61.567 on April 29.

With the new adjustments, prevailing oil prices at the pump in Metro Manila and highly urbanized areas are expected to reach as high as P107.11 per liter for gasoline, P107.48 per liter for diesel, and P146.46 per liter for kerosene.

“Now it seems like (global oil prices are) steadying at a certain pace and hopefully it stays like that. There’s no assurance. The Department of Energy cannot give an assurance that prices are going up or down,” Ms. Garin said.

Meanwhile, the cost of liquefied petroleum gas (LPG) has gone up by P1.22 per kilogram this month, pushing the price of an 11-kilo cylinder to P1,070.41 – P1,701.77.

According to Ms. Garin, the country’s fuel inventory can sustain demand for approximately 53.71 days as of May 1, decreasing from 54 days last week.

The average inventory for gasoline is at 52.64 days, 54.58 days for diesel, 166.67 days for kerosene, 71.14 days for jet fuel, 62.69 days for fuel oil, and 40.46 days for LPG.

“There’s been a decrease on the consumption or on the demand, but there is no problem as to the deliveries that our oil companies are getting,” Ms. Garin said. “Their orders are being honored, their contracts are being honored…. Our usual and new suppliers are responding to the orders of our companies.”

Despite a slight decline in the fuel inventory, Ms. Garin said the government is not yet looking to procure additional supply after importing more than 150 million liters of diesel.

“For now, that will be used for whatever purpose aligns with our priorities. However, there’s no need to place another order yet,” she said.

On the proposed legislation to remove value-added tax (VAT) on electricity components, Ms. Garin said they are in favor of this measure as long as it would help lower costs.

“We have been consistent in our opinion on VAT removal because anything that would lower the price of electricity, the DoE supports,” she said. — S.J.Talavera