Oil price rollback seen next week


Prices of petroleum products are expected to fall next week after three consecutive weeks of increases.

Fuel prices are projected to retreat due to the softening of imported fuel prices.

Industry sources said the reduction in pump prices could be less than P1 per liter.

Energy Undersecretary Zenaida Monsada said the reduction can either be bigger or smaller because of the downward price direction of oil on the global market.

Monsada, however, said that the actual amount of rollback could not be projected as of press time.

Pilipinas Shell Petroleum Corp. Chairman Edgar Chua confirmed that the price reduction could be  imminent.

“The average for the last three days has been lower than last week. So hopefully next week, if the trend continues, hopefully it will be lower,” he said.

Imported fuel prices continued to plunge, based on Monday to Wednesday trading data.
Chua said that finished products were lower by more than $1 per barrel.

Prices of Liquefied Petroleum Gas (LPG), however, are expected to rise next week.

According to industry sources, LPG prices are likely to go up by about 40 to 50 centavos per kilo or a hike of P4.40 to P5.50 for an 11-kilo cylinder.

For three consecutive weeks, oil companies raised gasoline prices by an average of P4.11 per liter, P4.20 per liter for diesel, and P3.15 per liter for kerosene.

Meanwhile, Pilipinas Shell said it will bear the brunt of the continued plunge in oil prices.

Chua said the company reported a loss of about P1.2 billion in 2013 and they expect to incur further losses in 2014 because of the plummeting fuel prices.

“It’s very bad, because we have inventory, let’s say 5 million to 6 million barrels at any given time,” he said.

Since oil prices dropped by $50 from June to September, Chua said they could have lost $300 million for that inventory.

“I’m just telling you that from my point of view it’s not good,” said Chua when asked about the company’s financial standing as of last year.


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