WORLD OIL PRICES (July 18-22, 2022 trading days)

The week-on-week price of Dubai crude has increased by about $4.20/bbl. On the contrary MOPS gasoline, MOPS diesel as well as MOPs kerosene have decreased by about $1.60 per barrel, $5.20 per barrel and $3.50 per barrel, respectively.

Reasons for the Price Adjustment¹

• Crude prices ended last week with a sharp fall after a wider sell off as recessionary fears had gripped the market. The trigger was the release of high inflation numbers of US and a resulting expectation of Fed tightening. But crude prices then started to rise this week as record power demand offset deteriorating macro-economic factors.

o The price rise was also fueled after Saudi officials said that they were committed to OPEC+ agreement on supply even after persuasion by US president Joe Biden on his trip to Saudi Arabia. This was coupled with supply concerns and vulnerability of Europe to supply disruptions in winter.

• Asian gasoline cracks fell sharply and settled at $10.57/b down on week by $6.95/b as the regional supply tightness has been easing, with slowing demand from some countries.

o Singapore's commercial stockpile of light distillates rose 6.91% week on week during July 14-20 due to a rise in gasoline imports that increased 28.41%, aided by high refinery run rates in South Korea encouraging shipments to Singapore.

o An import duty has been imposed on Chinese gasoline into Pakistan, which has been one of the major sinks of Chinese gasoline in 2022. This may likely divert these cargoes to Southeast Asian markets, and put additional downward pressure on the Asian gasoline market.

• The downward pressure on Asian gasoline market has also been due to a weakening US gasoline market. The weaker crack came on the back of a rise in US gasoline stocks, which rose 3.5million barrels to a more than a two-month high of 228.435 million barrels in the week ended July 15 as per EIA data.
   
• The Asian gasoil crack fell on week by $10.18/b and settled at $34.55/b on July 14 Asian close, easing supply tightness on the back of elevated outflows from net exporting countries to capture attractive gasoil cracks. This has also been putting a downward pressure on the gasoil market.

o Singapore's onshore commercial middle distillate stocks rose 5.92% week on week to a four-week high of 8.07 million barrels over July 14-20 as per Enterprise Singapore data.

o Sell-side tender activity from South Korea has been ongoing at a strong and steady pace, while Japan is also stepping up its exports post its refinery maintenance season. Refinery runs have also been rising after maintenance as Asian refinery downtime decreased by a significant 830,000 b/d to 1.51 million b/d for the week ending July 22, with major turnarounds in the Middle East, South Asia, China, and Japan having ended.

• South Korea expects to cut imports of 0.005% sulfur gasoil by 10%, or around 5 million mt/year, by suspending operations at gasoil-fired power plants. Even demand from Vietnam has softened recently with buy-side activity continuing at a slower pace to meet domestic demand.

FOREX: Philippine peso depreciated week-on-week against the US dollar by P0.08 to P56.33 from P56.24 in previous week.

DOMESTIC OIL PRICES

Effective 26 July 2022, the oil companies implemented a price decrease in gasoline by P0.40 per liter, diesel by P1.85 per liter and kerosene by P1.30 per liter.

These resulted to the year-to-date total adjustments to stand at a net increase of P18.90/liter for gasoline, P32.95liter for diesel and P28.05/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.

Other recommended reference sites:
    • http://www.aip.com.au/pricing
    • http://www.indexmundi.com/commodities/?commodity=crude-oil-dubai
    • https://www.quandl.com/data/ODA/POILDUB_USD-Dubai-Crude-Oil-Price

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

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¹ Asia Pacific Weekly Recap by S & P Global Platts Analytics