Oil Monitor as of 29 September 2020

Date published: September 29, 2020

WORLD OIL PRICES (September 21-25, 2020 trading days)

Dubai crude has increased week-on-week by about US$0.70/bbl. MOPS gasoline has also increased by almost US$0.70 per barrel. MOPS diesel has decreased by about a cent.

Reasons for the Adjustment

  • Platts latest outlook see uneven demand recovery across the world amid slower economic growth. US oil demand dropped by 5.6 million b/d (MMB/D) in April and rebounded strongly in May and June. Despite continued COVID-19 infections in several states, oil demand is seen to remain positive over the rest of this year. Yet, month-on-month demand growth in the US is likely to be weak in the fourth quarter with slowdown of various economic indicators recently.
  • Crude supply will continue to rise through 2021. Global supply is expected to increase by 2.4 MMB/D from Oct to end-2020, and then 6.6 MMB/D through end-2021. Almost all of the gains going forward will come from OPEC+ as US production is set to sharply decline on lower spending.
  • The potential return of 1 MMB/D of Libyan supply pose a major problem for OPEC+ ability to manage prices while COVID-19 continues to impact demand.
  • Gasoline and gasoil/diesel demand remain a concern worldwide. After bottoming out in April, demand for these products rebounded and remained strong throughout the summer. However, demand recovery is expected to slow down after summer vacation seasons and will remain vulnerable to potential outbreaks and localized lockdowns.
  • Asian gasoline market participants raised concerns over slowing driving activity in Southeast Asia, which is likely to dent sentiment. Primarily, driving activity in Thailand and Indonesia were recorded under baseline levels as of Sept 20. The slowdown reportedly echoes growing concerns over the worldwide demand outlook for gasoline, particularly as talks are ongoing in the UK and several regions in Europe over fresh movement restrictions.
  • Gasoil/diesel demand recovery in Asia remained clouded by a resurgence of COVID-19 infections around the region. Still, reduced production at several regional refineries due to receding margins is poised to reduce outflow volumes and tighten the supply outlook in the months ahead. However, even with reduced production, supply outflows from China are still expected on the back of weaker domestic demand and persistently high stockpiles.

FOREX:  Philippine peso depreciated week-on-week against the US dollar by P0.03 to P48.47 from P48.44 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 adjustments effective today, 29 September 2020. Gasoline has increased by P0.20 per liter, diesel by P0.05 per liter and kerosene by P0.45 per liter.

These resulted to the total year-to-date adjustments to stand at a net decrease of P4.42/liter for gasoline, P10.71/liter for diesel and P14.39/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

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