WORLD OIL PRICES (July 21-25, 2014 trading days)

Crude oil prices slightly picked up in some postings during the week. This was reportedly due to the large decline in US crude inventories in the week ending 18 July 2014, and some encouraging economic data in the US, China and Europe, indicating strong demand in the world’s big economies.

However, the market was being tempered by reports of soft demand as investors and traders continue to monitor geopolitical tensions affecting key crude producing regions Russia and the Middle East. Analysts believed that there would be no sustained price gains unless reports emerge of actual supply-side disruptions. Reports also disclosed that the market is comfortably supplied, with seasonal demand in Europe still slackening.

Meanwhile, investors were keeping an eye on events in Eastern Europe as the US and its allies plan another round of sanctions on Russia. The possibilities of tougher sanctions against Russia may spark an oil crunch in Europe.

On Asian oil products, Platts noted that gasoline remained under pressure from weakness in the US market and lackluster demand in Asia. The Energy Information Agency, statistical agency of the USDOE, reported that gasoline stocks rose by 3.38 million barrels to almost three times the build that analysts had expected. Meanwhile, Asia’s regional supply in August is expected to rise in tandem with refineries coming back from maintenance, curbing some of the spot demand that had lifted the July market.

On the other hand, Asian gasoil/diesel market remained bearish in the absence of strong demand that failed to lift sentiment in an overly-supplied market, Platts noted. Singapore gasoil market continued to have ample supply and weak regional demand. A well-supplied gasoil market in Europe also prevented cargoes from heading to the West. Further exacerbating the situation, freight rates were reportedly rising on tight tonnage, increasing the cost of any arbitrage movement.

Overall, Dubai crude increased week-on-week by about US$0.50/bbl. Meanwhile, MOPS gasoline and diesel decreased by about US$4 and US$0.20 a barrel, respectively.

FOREX: Peso per US dollar rate depreciated week-on-week by P 0.23 to P43.34, from P43.57 in the preceding week.

Other recommended reference sites:
(1) http://www.aip.com.au/pricing (2) http://www.med.govt.nz/ers/oil_pet/prices/prices.html

DOMESTIC OIL PRICES

Effective 29 July 2014, most of the oil companies implemented a decrease of P1.20 for gasoline, P0.25 for diesel and P0.20 for kerosene.

With the said price movements, gasoline and diesel now have a year-to-date net decrease of P0.70 and P2.90, respectively.

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: http://www.doe.gov.ph