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Local fuel pump rates are poised to increase again
today, as world oil prices soared to new highs near $142 a barrel on
Friday.
Pilipinas Shell Petroleum Corp.
announced Friday that it will be increasing its fuel prices by P1.50
per liter in order to recoup its under-recoveries from the soaring
prices of oil in the world market.
Other local oil firms have yet to
make an announcement as of press time but are expected to follow
suit. This is the 10th-straight week oil companies have increased
pump prices and the 17th for the year.
As of June 1, the prevailing pump
prices in Metro Manila were already been hovering at P56.76 to
P58.57 per liter for unleaded gasoline; P53.60 to P56.80 per liter
for kerosene; and P49.50 to P51.47 for diesel.
The price of an 11-kilogram
liquefied petroleum gas (LPG) cylinder is about P600.00 to P671.50.
Amid the unabated increases, the
Department of Energy said consumers should be wary of unscrupulous
business looking to exploit the situation.
Energy Secretary Angelo Reyes
warned the public against using a dual fuel system, which utilizes
in-line blending of diesel LPG. “The results of the tests made by
the DOST [Department of Science and Technology] on this system have
been proved to be very inconclusive.”
He added, “LPG and diesel
combination are not proved to be safe.”
Reyes said the Energy department
will soon provide the guidelines and accreditation requirements for
the retrofitting of public jeepneys and buses from diesel (or
compression-ignition) to spark-ignition engines to allow the
100-percent utilization of alternative fuels, such as LPG,
compressed natural gas (CNG) and 85-percent bioethanol blends.
On June 16, President Gloria
Arroyo ordered the fuel conversion of jeepneys and buses to LPG and
compressed natural gas.
The government is banking on
alternative fuels, which are relatively cheaper and cleaner, to
mitigate the effects of high crude prices.
New world record
Oil prices jumped to record high
levels nearing $142 a barrel on Friday, a day after the Organization
of Petroleum-Exporting Countries’ (OPEC) president said they could
reach $170 this year owing to a weak dollar and geopolitical unrest.
Brent North Sea crude reached a
historic $141.98 and New York light sweet crude struck $141.71 a
barrel in electronic deals.
Crude futures crossed $140 for
the first time on Thursday following the price prediction made by
the president of OPEC, Algerian Energy Minister Chakib Khelil, in an
interview with the television news channel France 24.
After achieving new peaks on
Friday, Brent North Sea crude for August delivery stood at $141.33 a
barrel, up $1.54 from Thursday’s close, as traders banked their
profits.
New York’s main oil futures
contract, light sweet crude for August, was at $141.15, up $1.51.
The cost of oil has doubled in a
year, with consumers blaming the surge on insufficient output from
the OPEC.
OPEC, which produces 40 percent
of the world’s oil, said speculators are responsible for pushing
up crude in reaction to a falling dollar and tensions in
oil-producing countries, such as Iran, Iraq and Nigeria.
A weak US currency makes oil
priced in dollars cheaper for foreign buyers, thus pushing up demand
for the commodity.
In a volatile trading week, Oil
prices had closed down $3.50 on Wednesday after official data
revealed an unexpected rise in stockpiles in the United States, the
world’s biggest energy consumer.
The US Department of Energy said
stockpiles of crude had risen for the first time in six weeks, by
800,000 barrels, in the week to June 20. Analysts had expected a
drop of 1.1 million barrels.
Oil prices had rallied at the
start of the week after major energy producers ruled out further
output despite consumer fears the world faces a tight supply
situation.
Saudi Arabia’s King Abdullah
had announced on Sunday that his country had increased output to 9.7
million barrels a day as he opened a summit on the soaring
international price of crude in the Saudi city of Jeddah involving
producers and consumers.
But the market had already
expected the formal announcement after the kingdom’s London
embassy had released a statement last week that outlined a plan to
increase output by 200,000 barrels a day.
Prices also shot higher on Monday
after militants blew up a pipeline in Nigeria over the weekend,
traders said.
Militants had attacked a key
Chevron oil supply pipeline in the latest operation targeting
Nigeria’s oil industry.
The US oil giant was forced to
shut down activities after the attack in the volatile Niger Delta,
halting output by 120,000 barrels per day.
The Anglo-Dutch oil giant Shell
has also said that it cannot promise to deliver 225,000 barrels per
day for June and July following an unprecedented raid on its
offshore Bonga oilfield.
Unrest in the Niger Delta has cut
total oil production in one of Africa’s biggest producers by a
quarter over the past two years.
--AFP
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