WORLD OIL PRICES (November 9-13, 2020 trading days)
Dubai crude has increased week-on-week by almost US$4.00/bbl. MOPS gasoline and MOPS diesel have also increased; gasoline by about US$3.50 per barrel and diesel by nearly US$4.70 per barrel.
Reasons for the Adjustment
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Oil balancing slows again but recovery is seen to continue, supporting prices in 2021.
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Global oil supply is expected to down by 6.9 million b/d in 2020, and then up by 3.2 million b/d in 2021.
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Global oil demand is expected to contract by 8.5 million b/d in 2020, before growing by 5.8 million b/d in 2021.
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Market analysts see Asia to lead global demand recovery, led by China, India and Southeast Asia.
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Asian product demand is expected to contract by 1.7 million b/d in 2020, before growing by 1.5 million b/d in 2021.
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China and India are expected to account for 60% of regional growth in 2021, with Southeast Asia contributing to 30%1.
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- Oil prices have surged during the week to five-month highs after Pfizer and BioNTech said that their COVID-19 vaccine had proven to be more than 90% effective in a phase 3 trial.
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The International Energy Agency (IEA) does not expect major enhancement in oil demand from vaccines until it will be widely available from mid-2021, from which point mobility and oil demand will "return progressively to normal conditions".
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Crude oil futures sentiment in Asian trade was lifted by positive signals from OPEC’s sustained production cuts.
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The market largely expects OPEC+ to extend its current 7.7 million b/d output cut until at least the first few months of 2021, instead of tapering them to 5.8 million b/d as scheduled.
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While Algerian energy minister Abdelmadjid Attar suggested to increase output cut, Iraq and Saudi Arabia have affirmed their "full commitment" to the OPEC+ output curbs decision in order to achieve an oil price that is fair to both consumers and producers.
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The Asian gasoline market was stronger on positive headlines from the US in view of the effectivity of Pfizer and BioNTech COVID-19 vaccine, which resulted to a sharp rise in the energy complex across the barrel.
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The Asian gasoil/diesel market has improved sentiment on expectation of tightening supply, consistent with Platts assessment that Asian refinery runs are relatively weak in November and December due to weak margins.
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Platts however has seen limitation in gasoil price uptick in the near term, as Middle East volume are arriving in Singapore due to closed arbitrage for East of Suez to Europe. European demand has been further depressed by the second wave COVID-19 outbreaks and lockdowns.
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FOREX: Philippine peso appreciated week-on-week against the US dollar by P0.11 to P48.24 from P48.35 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
The oil companies implemented their price increase effective today, 17 November 2020. Gasoline increased by P1.05 to P1.10 per liter, diesel by P1.50 to P1.55 per liter and P1.30 per liter for kerosene.
These resulted to the year-to-date adjustments to stand at a net decrease of P4.62/liter for gasoline, P9.36/liter for diesel and P12.59/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.
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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 Oil Market Forecast, November 12, 2020