WORLD OIL PRICES (August 23-27,2021 trading days)
Dubai crude has increased week-on-week by almost US$1.75/bbl. MOPS gasoline and MOPS diesel have also increased by around US$1.00 per barrel and US$ 2.20 per barrel, respectively.
Reasons for the Price Adjustment
- Oil prices rose 2% on Friday, the biggest weekly gains in over a year, as energy firms began shutting U.S. production in the Gulf of Mexico ahead of a major hurricane IDA that made its landfall in Louisiana last Sunday.
- More than half of total US oil and gas production came offline in the Gulf of Mexico ahead of Hurricane Ida by Aug. 27, and Louisiana's refining and petrochemical operators were bracing for the heavy winds and the storm surge of a major hurricane.
- Ida was upgraded from a tropical storm to a Category 1 hurricane Aug. 27, with the National Hurricane Center projecting that it would strengthen to a major Category 4 storm before making landfall late Aug. 29 or early Aug. 30 along the Louisiana coastline -- and likely just west of New Orleans.
- The growing expectations that OPEC+ might resist raising output given the recent Delta variant impact over crude demand was also said to have pushed oil prices higher.
- However, some reports disclosed that crude oil prices rallied amid a broader rebound in commodity markets as demand concerns in the US and China eased. China National Health Commission reported zero case for the first time in over a month allaying fears of markets over uncertain demand outlook amid improving mobility indicators.
- Drawdown in US crude and gasoline inventories was more encouraging for the oil market and goes on to suggest that demand is withstanding Delta variant outbreak.
- Weaker US dollar and full approval for Pfizer-BioNTech’s coronavirus vaccine further added to the price rally.
- Market sentiment in the Asian gasoline market remained vigilant as rising COVID-19 infections in Malaysia and the Philippines stoked concerns of stalling driving activity despite easing of restrictions in these countries. On the supply side, the uptrend of more barrels heading to Singapore continued in the Asian market with at least four LR1 tankers coming from China.
- However, Asian gasoline market got support from sharp drawdown in US gasoline inventories. For the week ending Aug.20, total US gasoline inventories fell by 2.24 million barrels far exceeding the market expectations of 1-1.5-million-barreldrawdown.
- Regional fundamentals in the Asian gasoil/diesel 10 ppm remained slightly bearish with modest demand meeting slightly lower re-supply in the region but got a boost from moving barrels to the West. Cooling of freight rates on the Arabian Sea to UK Atlantic Coast and Atlantic (AG-UKC) route helped in the widening of arbitrage.
- Gasoil/diesel demand in Europe has been buoyed by peak holiday season amid low inventory levels in ARA (Amsterdam-Rotterdam-Antwerp) hub currently hovering below the 5-year range.
FOREX: Philippine peso appreciated week-on-week against the US dollar by P0.39 to P50.08 from P50.48 in previous week.
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
DOMESTIC OIL PRICES
Effective 31 August 2021, the oil companies implemented a price increase in domestic oil products, i.e. P0.25-P0.40 per liter for gasoline, P0.60 per liter for diesel and P0.70 per liter for kerosene.
These resulted to the year-to-date adjustments to stand at a total net increase of P12.85/liter for gasoline, P9.95/liter for diesel and P8.10/liter for kerosene.
For the updated prevailing retail pump prices, please refer to this link: https://www.doe.gov.ph/price-monitoring-charts?q=retail-pump-prices-metr...
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