Oil Monitor as of 08 January 2020

Date published: January 8, 2020

WORLD OIL PRICES  (December 30, 2019 - January 3, 2020  trading days)

Dubai crude has increased week-on-week by almost US$0.10 per barrel.  MOPS diesel has also increased by around US$1.05 per barrel while on the opposite MOPS gasoline has decreased by nearly US$0.20 per barrel. 

Reasons for the Adjustment

  • Global crude oil prices jumped in intra-day trading Friday morning on news that a US-led airstrike killed Iranian General Qassim Soleimani, leader of the Iranian Revolutionary Guard's foreign wing, in Iraq. The heightened geopolitical tension in the Middle East and potential escalation of hostility between the US and Iran further threatens to affect global oil output. 
    • The US Department of Defense confirmed that Iran leader was killed in the strike attack at Iraq’s Baghdad International Airport to deter future Iran attack plans.
    • The likelihood of additional attacks on Middle East energy infrastructure as well as the possibility of military conflict between the US and Iran have increased. 
    • Saudi Arabia's energy facilities as well as foreign tankers in and around the Persian Gulf have been the target of several attacks over the past year - a region that includes OPEC's five biggest producers.
    • The recent events in Baghdad could set the tone for higher Iraqi crude official selling prices, but Chinese and South Korean refiners are unlikely to turn their backs on the country's flagship Basrah crude, an important feedstock grade in the region.
  • Traders cited the additional supply cuts announced by OPEC and non-OPEC producers which took effect January 1, as well as supply disruption risks triggered by military confrontation between the US and Iran-backed Iraqi militia as key reasons behind the OSP price hikes to medium and heavy sour crude supply from the Middle East to Asia. 
  • Heightened tensions in the Middle East following reports of an airstrike in Baghdad Friday morning weighed on the Asian gasoline market, as traders assessed the potential impact the tensions would have on global crude oil.  Crude and freights costs are expected to be volatile moving forward notwithstanding the spike in crude markets.  
  • Gasoil fundamentals were seen tight in the region, due to a spate of refinery turnarounds scheduled for Q1.

FOREX:  Week-on-week value of Philippine Peso appreciated against the US dollar by P0.04 to P50.76 from P50.80 in the previous week.

Other recommended reference sites:

DOMESTIC OIL PRICES      

Effective January 7-8, 2020, most of the oil companies implemented a price decrease/increase on petroleum products. Gasoline has decreased by P0.10/liter while diesel and kerosene have increased by P0.40/liter and P0.30/liter, respectively.

Year-to-date adjustments stand at a net decrease of P0.10/liter for gasoline and a net increase of  P0.40/liter for diesel and P0.30/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

Pages