Oil firms to reduce gasoline prices Monday

Categories: Business Updates

Date Posted: 10 Aug 2014

Gasoline prices are dropping for the fifth straight week starting Monday (Aug. 11), mainly due to weak international prices, according to oil firms.

Petron, Shell, Chevron, Seaoil, and PTT Philippines have said in separate official advisories that they will roll back gasoline prices by P0.85 per liter from 12:01 a.m. August 11. The adjustment would reflect movement in the international oil petroleum market and foreign exchange, they said on Sunday.

Phoenix Petroleum is imposing the same price cut for gasoline but a little later, starting from 6 a.m. August 11.

There will be no price movements for diesel and kerosene, the oil firms have said.

Other oil firms have not announced price movements as of Sunday evening but are expected to make similar adjustments since nearly all the fuel products in the country are imported and thus vulnerable to international prices movements.

Including the price movements this week, the year-to-date total adjustments stand at a net decrease of P2.55 per liter for diesel and about P2.35 per liter for gasoline.

The usage and pricing of gasoline (or petrol) results from factors such as crude oil prices, processing and distribution costs, local demand, the strength of local currencies, local taxation, and the availability of local sources of gasoline (supply).

Analysts said that seasonal factors might be at play. The so-called driving season in the US (a demand-boosting period from April through September) is set to end in a few weeks and that has apparently got traders thinking of how sales will fare afterwards.
The US is arguably the largest consumer of petroleum products in the world, which means the economy’s fuel demand and supply situation could sway the international petroleum market.

Meanwhile, analysts say further price reductions may be coming as volatility persists in the global oil market amid new production, including from unconventional sources in North America. Some estimates bet on a $70 per barrel price for Brent crude oil in 2020, down from the current price of over $100 per barrel.
Written by: Riza T. Olchondra

Source: http://business.inquirer.net/176370/oil-firms-to-reduce-gasoline-prices-monday

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