PUMP PRICES of fuel retreated due to falling demand in the US and weak Chinese exports, the Department of Energy (DoE) said.
“There is only a minimal difference between world supply and world demand. In fact, according to the outlook for November, there is a deficit of 0.31 million barrels of crude per day. So, any kind of supply disruption would increase the price,” Rodela I. Romero, assistant director of the DoE’s Oil Industry Management Bureau, said in a Viber message.
“But considering the falling of crude demand in two big economies, the US and China, the remaining supply is enough to cater to world demand,” she added.
On Monday, oil companies announced in separate advisories that prices will fall by P0.70 per liter of gasoline, P3 per liter of diesel, and P2.30 per liter of kerosene, effective on Tuesday.
Caltex, Inc. was due to implement price adjustments at 12:01 a.m., followed by Seaoil at 6:00 a.m. on Tuesday.
This week’s price movement extends the streak of rollbacks in diesel and kerosene for a third straight week. Gasoline prices have fallen for two consecutive weeks.
Oil firms last week slashed prices by P0.45 per liter for diesel and P1.10 per liter for kerosene. Gasoline prices rose P1.05 per liter.
As of Nov. 13, year-to-date price adjustments totaled P13.05 per liter for gasoline, P6.35 per liter for diesel, and P1.69 per liter for kerosene.
“Poor demand from Asian markets most specifically from China contributed to the downward movements with some participants even commenting that the decreases can be expected for a longer period,” Raymond T. Zorilla, senior vice-president for external affairs of Phoenix Petroleum, Inc., said in a Viber message.
Asked for his outlook on Philippine price movements in the coming weeks, he said: “Well history is not reliable anymore. Usually with the onset of winter, prices go up as fuel is used for heating.”
“But given the volatility of prices due to demand as well as the observations of the analysts, we may hopefully expect a continued decline,” Mr. Zorilla said.
Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said that the decline in global crude oil prices “could help ease inflationary pressures in terms of more local fuel price rollbacks and recently supported the gains in the US/global/local financial markets.”
Meanwhile, he said that the Gaza war “has not yet widened/escalates” due to diplomatic efforts, which is why global crude oil prices fell.
“Then again, geopolitical risks remain uncertain, going forward, especially on the impact on global oil prices,” he said in a Viber message.
Headline inflation eased to 4.9% in October, according to preliminary data released by the Philippine Statistics Authority. This weakened from the 6.1% posted in September and 7.7% a year earlier.
In the first 10 months, inflation averaged 6.4%, above the central bank’s 5.8% forecast for the year. — Sheldeen Joy Talavera