Oil Monitor as of 12 April 2023

Date published: April 13, 2023

WORLD OIL PRICES (April 3-7, 2023 trading days)

The week-on-week price of Dubai crude has increased by almost $7.30/bbl. MOPS prices of gasoline, diesel and kerosene have also increased per barrel by about $7.00, $3.70 and $4.50, respectively, during the reference week.

Reasons for the Price Adjustment1

The week’s increase in oil prices was largely driven by the following:

  • Oil prices rallied this week after Saudi Arabia, Russia, and other OPEC+ producers announced on April 2 they would make more than 1.6 million b/d of voluntary supply cuts in total on top of baseline production in February, with the bulk of these reductions starting in May and lasting until the end of the year.

  • Prior to the announcement, crude futures were already rising on a weaker dollar and the expectation of tighter supplies after about 450,000 b/d of northern Iraqi crude exports had been halted since March 24.

  • US crude inventories drew by 3.74 million barrels to 469.95 million barrels in the week ended March 31, EIA data released late April 5 showed, about 4% above the five-year average for this time of year. This is suggestive of high demand.
     
  • Asian gasoline crack vs. Dubai softened on week as of April 5 Asian close, as the M1/M2 backwardation2 flattened by $0.35/b to $1.90/b over the same period.
     
  • In order to guarantee the availability of refined fuels for the domestic market, the Indian government increased limits on the exports of diesel and gasoline. This helped to improve sentiment.

o India initially imposed these restrictions In July 2022 requiring that oil companies to sell the equivalent of 50% of their gasoline exports and 30% of their diesel exports domestically for the fiscal year ended March 31, 2023, along with a windfall tax on refined fuel exports.

  • On inventory, US gasoline stocks drew by 4.12million barrels on week to 222.58 million barrels in the week ending March 31, down 6.0% on year.
     
  • Asian gasoil/diesel crack weakened on week as of April 5 Asian close, as the M1/M2 backwardation weakened by $1.13/b on week to $0.73/b.
     
  • In Asia, expectations of leaner supply in the near term due to seasonal refinery turnarounds in North Asia and a potential reduction in Chinese gasoil exports in April provided some relief to the market.
  • On inventory, Singapore’s onshore middle distillate stocks fell by 8.5% to a four-week low of 9.01 million barrels in the week ended April 5.

FOREX: The week-on-week average of Philippine peso depreciated versus the US dollar by P0.13 to P54.53 from P54.40 in previous week.

 

DOMESTIC OIL PRICES

Effective 11 April 2023, the oil companies implemented a per liter increase of P2.60 for gasoline, P1.70 for diesel and P1.90 for kerosene.

These resulted to a year-to-date net decrease for diesel at P1.95/liter and kerosene at P3.45/liter. Gasoline on the other hand, has a net increase of P8.65/liter.

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.

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

For more information, call the

Department of Energy
Pricing: 840-2187
LPG: 840-2130
Fuels: 840-5669
Website: https://www.doe.gov.ph

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1 Asia-Pacific Weekly Recap 06 April 2023 by S&P Global Platts Analytics
2 When a market is in backwardation, the forward price of the futures contract is lower than the spot price.

 

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