Oil Monitor as of 28 December 2022

Date published: December 29, 2022

WORLD OIL PRICES (December 19-23, 2022 trading days)

The week-on-week price of Dubai crude has increased by around $1.35/bbl. MOPS gasoline and kerosene have also increased by about $2.10 and $1.90 per barrel, respectively. On the opposite, MOPS diesel has decreased by nearly $0.80 per barrel.

Reasons for the Price Adjustment1

  • Crude oil futures witnessed a volatile week as the tightening of supply in the US and uncertainty around Russian supply countered weak demand in China.

o The US Department of Energy on Dec. 16 announced plans to purchase oil to begin replenishing its SPR following the 180-million-barrel release over several months to combat energy price hikes spurred by Russia's invasion of Ukraine.

o US crude inventories extended declines. The US EIA reported a 5.9-million-barrel draw in commercial crude stocks to 418.23 million barrels in the week ended Dec. 16. The draw was in line with seasonal norms but exceeded market expectations of a 3.1-million-barrel decline during the week.

o In China, traffic jam index and subway turnovers continued deteriorating on week for the week ended Dec. 18 as most people still chose to stay at home due to wide spreading of COVID-19 and overloading of medical facilities after Beijing abruptly dismantled three-year-long zero-COVID strategy.

  • Asian gasoline crack improved, tracking strength in US RBOB-Brent crack despite mixed fundamentals in the Asian region. Asian gasoline crack vs. Dubai have increased on week as of Dec. 22 Asian close, tracking strength in US RBOB-Brent that followed an increase in total gasoline supplied in the US. Asian gasoline crack has averaged $7.35 to date in December, compared with $6.91 in November, $0.12/b in October and $2.87/b in September.
     
  • On the demand side, market talks indicated that Indonesia, Southeast Asia's largest importer of gasoline, is expected to see softened gasoline demand further toward the year end due to ample supplies and high inflation.

o Singapore’s commercial stockpiles of light distillates, which include gasoline, reformate, and naphtha, increasedby15.5% on week to 15.82million barrels in the week ended Dec. 21, still up 31.6% on year, Enterprise Singapore data showed.

o Supply from China is expected to be firm in December despite recent loosening of
COVID-19 restrictions. Platts further noted that China gasoline exports is expected to
decrease in 2023 due to domestic demand slowly picking up as cases peak and ebb.

  • Asian gasoil crack dropped but increasing call from the West will set the floor of Asian gasoil crack in the wake of the EU's sanctions on Russian-origin oil products effective Feb. 5.

o The EU's sanctions on Russian-origin oil products effective Feb. 5 could lead to greater dependence on Asian barrels. European and Mediterranean imports of ultra-low sulfur diesel from the East of Suez are set to rise 61% on the month to 2.87 million mt in December, the highest inflows from the region since December 2021 according to cflow data.

o On regional supply, China's gasoil outflows continued to be the key focus of the Asian gasoil market participants as the country reopens and manages the surge in COVID-19 cases, as well as the potential issuance of a fresh batch of oil product export quotas
for 2023.

FOREX: The week-on-week average of Philippine peso appreciated versus the US dollar by P0.43 to P55.27 from P55.70 in previous week.

 

DOMESTIC OIL PRICES

Effective December 28, 2022, the price of diesel has decreased by P0.20 per liter while gasoline and kerosene prices have increased by P0.95 and P0.50, respectively.

These resulted to the year-to-date total adjustments to stand at a net increase of P14.90/liter for gasoline, P27.30/liter for diesel, and P21.30/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.

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
SMS: (0915) 4469421
Email: oilmonitor@doe.gov.ph
Website: https://www.doe.gov.ph

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1 Asia Pacific Weekly Recap by S & P Global Platts Analytics

 

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