WORLD OIL PRICES (February 2-6, 2015 trading days)

A report emphasizing the dramatic drop in U.S. oil drilling rigs in recent months and a cutback in the exploration budgets of energy firms triggered oil prices to rebound last week. The rebound compounded by the strike called by the United Steelworkers (USW) union at nine (9) U.S. refineries and chemical plants across the U.S. on 01 February 2015. This developed after their previous contract expired and industry negotiators, led by Shell, failed to address serious concerns raised by the union regarding the health and safety of workers and their communities.

The spike of about US$6 to US$9 a barrel in crude and products prices over the week also raised questions on whether the market had found a bottom to the sell off that began in June and is now in its eighth month.

Nonetheless, record high oil inventories in the United States cut short the four-day rally as crude oil price (WTI) abruptly fell below $50 again on Wednesday, but have recovered and settled at around US$52 last Friday. The US-DOE disclosed that the country’s crude stocks jumped by 6.3 million barrels to 413.06 million in the week ending January 30. This was the newest record highs in crude inventories since records began in 1982, according to the government-run Energy Information Administration. Traders and investors had expected a build of just about 3.5 million barrels for the week ended Jan. 30.

In the Asian gasoline market, Platts reported that the strikes are having an impact on the Asian market, as sentiments firmed along with a stronger US market driven up by the strike. Yet, a North Asia-based trader noted that market fundamentals remained unchanged, with ample gasoline supplies still stuck in the region. Industry participants said that Pakistan increasing gasoline imports was unlikely to help alleviate the oversupply situation in Asia, considering the strong arbitrage economics, with more barrels coming from Europe.

For gasoil/diesel, fundamentals in the Asian market reportedly remain largely unchanged, characterized by poor demand in the region and plentiful supply streaming out from North Asia.

Further on crudes, Saudi Aramco cut its official selling prices for crudes loading in March and bound for Asia by 40-90 cents/barrel, so as to stay competitive with abundant crude available to Asian buyers.

FOREX: Peso per US dollar rate depreciated by P0.02 to P44.13, from P44.11 in previous 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 10 February 2015, most of the companies implemented an increase in prices by P2.40/liter for gasoline, P1.90/liter for diesel and P2.15/liter for kerosene.

The total year-to-date adjustments are now at a net decrease of P1.20 for gasoline and P2.25 for diesel.  LPG remains at net decrease of P4.80/kg.

* RON 95

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