WORLD OIL PRICES (October 17-21, 2022 trading days)

The week-on-week price of Dubai crude has decreased by almost $4.30/bbl. MOPS gasoline has also decreased by around $1.00 per barrel as well as MOPS diesel and kerosene by nearly $2.80 and $2.15 per barrel, respectively.

Reasons for the Price Adjustment¹

• Oil prices retreated this week as China’s commitment to zero-Covid dashed hopes for a sharp rebound of near-term demand in the world’s largest crude oil importer. Chinese President Xi Jinping on Oct. 16 reiterated Beijing’s unwavering stance on its dynamic zero-COVID policy during a speech opening the Communist Party’s twice-a-decade No. 20 National Congress, signaling no immediate change will be made to the country’s stringent COVID-19 curbs despite a heavy toll on economic growth.

o Most recently, almost 1 million residents of Zhong yuan district in Zhengzhou, the capital city of Henan province, were ordered to stay at home from Oct. 17 after sporadic cases were reported (8 confirmed new local cases on Oct. 16 and 7 confirmed new local cases on Oct. 15 for the entire province of Henan). Although Chinese officials were reportedly debating whether to reduce the mandatory quarantine period, presently 10 days upon entry to the country, according to a Bloomberg report citing unnamed sources, it’s unlikely for the government to take a major step to re-open the border anytime soon.

• A surprise draw in US crude inventories and Washington’s SPR buyback plan provided some reliefs to the oil markets. EIA data released late Oct. 19 showed that US commercial crude inventories fell by 1.73 million barrels to 437.36 million barrels in the week ended Oct. 14, compared with market analysts’ expectations of a 2.5 million-barrel-build.

• The fall came even as stocks in the SPR extended declines by 3.56 million barrels to a fresh 38-year-low of 405.14 million barrels over the same week. US President Joe Biden announced Oct. 19 to release 15 million barrels of crude for delivery in December from the SPR, completing his commitment to release roughly 1 million b/d over a six-month period.

• Asian gasoline crack vs Dubai slightly recovered as stockpiles saw a weekly draw in the US and Singapore, but a rise in Chinese exports continued to weigh on the markets. Chinese exports are set to rise in the coming months following the release of fresh refined product export quotas. Reports indicated that export volume could rise to above 1 million metric ton in October, more than doubling from September.

• In distillate fuels, the EIA reported an inventory increase of 100,000 barrels for last week. This compared with two consecutive weekly draws of a combined 8.3 million barrels.

FOREX: The week-on-week average of Philippine peso appreciated versus the US dollar by P0.03 to P58.93 from P58.96 in previous week.

DOMESTIC OIL PRICES

Effective 25 October 2022, the oil companies implemented a per liter decrease in gasoline by P0.35, diesel by P1.10 and P0.45 for kerosene.

These resulted to the year-to-date total adjustments to stand at a net increase of P16.10/liter for gasoline, P37.40/liter for diesel, and P29.20/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