Oil Monitor as of 06 May 2020

Date published: May 7, 2020

WORLD OIL PRICES (April 27-May 1, 2020 trading days)

Dubai crude increased week-on-week by less than a dollar.  MOPS gasoline increased as well by nearly US$2/bbl while diesel decreased by about one dollar a barrel.

Reasons for the Adjustment

  • Platts’ latest World Oil Market Forecast revised its global oil supply significantly lower, particularly for 2Q as it reduced by about 9 MMB/D to 92.7 MMBD, from 102 MMB/D in Q1, on the back of 9.7 MMB/D OPEC+ cut deal and additional non-OPEC supply reductions that will be required. As of end-April about 3.4 MMB/D of shut ins has been announced, but more will be required to balance the market and will need price signals, the report said.
  • Gasoline world demand is expected to shrink 2.5 MMB/D in 2020, but demand decline rate will moderate in Q3 2020 and its growth turn to positive in 4Q, based on the assumption that consumers will prefer to drive their own car rather than riding mass transit due to COVID-related safety concerns. Yet, it is also noted that global rate of unemployment will be reabsorbed nearly toward levels before COVID crisis by Q4. Otherwise, a high rate of unemployment would be a big drag on gasoline demand.
  • The price of gasoline is seen recovering, taking cues from slowly recovering world demand in the US, as most state and local governments began relaxing from lockdowns.
  • The spring turnaround and refinery run cuts in Asia is tightening supply of gasoil/diesel in the region.  The extended turnaround in some refineries due to poor demand conditions also helped to strengthen the market early this week.  But some traders pointed out that incremental volume are seen sailing from the Persian Gulf and India, coming at a time of still-fragile demand.

FOREX: Philippine peso appreciated week-on-week against the US dollar by P0.19 to 50.62, from P50.80 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 05 May 2020, the oil companies implemented P0.75/liter increase in gasoline while diesel and kerosene are decreased by P0.10/liter and P0.60/liter, respectively.

This brings the total year-to-date adjustments to stand at net decrease of P14.52/liter for gasoline, P16.99/liter for diesel and P22.50/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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