WORLD OIL PRICES (May 3-7, 2021 trading days)

Dubai crude has increased week-on-week by around US$2.30/bbl. Both MOPS gasoline and MOPS diesel have also increased by nearly US$2.35 per barrel.

Reasons for the Adjustment

• Oil prices recovered friday after a 1% dip in the previous session, on buoyant economic data from China and the US even as the surging pandemic in India capped prices.
  • Both Brent and WTI are on track for a second weekly gain as easing restrictions on movement in the US and Europe, recovering factory operations and coronavirus vaccination pave the way for a revival in fuel demand, while pent-up summer travel is likely to give petrol and jet fuel consumption a futher boost.
  • Oil recovery has been uneven as surging Covid-19 cases in India, the world’s third largest oil importer and consumer, has reduced fuel consumption.
  • Resurgence of Covid-19 in countries such as India, Japan and Thailand is hindering petrol demand recovery, energy consultancy FGE said in a client note, though some of that lost demand has been offset by countries such as China where recent Labour Day holiday travel surpassed 2019 levels.

• Platts report on the overall global demand picture is increasingly positive despite the COVID fears in Asia, as the vaccine-led recovery in the US and Europe gathers pace, keeping up with the forthcoming summer demand season.
  • While Asian demand is likely to lag behind western markets, Asian refinery runs are likely to begin rising, with most refineries returning from maintenance by the start of the third quarter.

• On supply, positive developments between the US and Iran could indicate a faster-than-expected return of Iranian crude back into the market.
  • A return to the nuclear deal could help sanctions on Iranian oil to return to pre-sanctions production level of about 3.9 million b/d (MMB/D) by next year.
  • India was a regular buyer of Iranian crude at sizeable volumes.

• Global demand for gasoline is still likely to see a strong upturn despite the weak driving activity amid the latest wave of COVID-19 infections. A combination of summer demand and vaccine-led economic recovery pick-up in the US and Europe will lead demand recovery.
  • In the near-term outlook, Asia appears to have less positive demand recovery, which could limit further upside for gasoline cracks as refineries run rates begin to pick up.
  • Gasoline cracks and time-spreads held steady over the week despite mounting COVID-related concerns throughout the region; Singapore light distillate stocks dipped by 4% week on week to a six -month low of 11.9 million barrels. The Asian gasoil/diesel market was holding steady at the end of the week, with market participants having mixed opinions on the market.

• The week ended with relatively steady upside gasoil/diesel market. Market participants expect leaner regional supplies due to refinery turnarounds as well as firmer anticipated demand from Europe that will lend support to the middle distillate, which includes diesel.

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 11 May 2021, the oil companies implemented the price increase in domestic oil products. Gasoline has increased by P0.75 per liter; both diesel and kerosene increased P0.70 per liter.

These resulted to the year-to-date adjustments to stand at total net increase of P8.55/liter for gasoline, P6.75/liter for diesel and P6.00/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.

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