Saturday, July 19, 2008

Headlines - Oil Price Watch July 19,2008

Diesel goes up by P3; gasoline up anew by P1
By Donnabelle Gatdula
Saturday, July 19, 2008

As world crude prices soften, a whopping P3 per liter increase in diesel prices is being implemented this weekend, the highest increase so far in the fuel used by most mass transporation vehicles.

The oil firms decided to carry out what they described as a “one-time, big-time” increase even as they came under fire from consumer groups and militant organizations for allegedly taking advantage of the rising global crude costs to overcharge consumers.

After rolling back gasoline prices by P1 per liter last week, the oil firms are also raising the price again by P1 per liter.

With the latest increase, the pump prices of diesel and gasoline now approach the P60 and P63 per liter mark, respectively.

Diesel price will range from P57.48 to P59.47 per liter; unleaded gasoline, P59.10 to P62.28 per liter; and kerosene, P59.41 to P63.30 per liter.

As of late afternoon yesterday, small oil players Seaoil Philippines, Eastern Petroleum, Unioil Petroleum and Flying V had raised their diesel prices by P3.

The four oil firms will also increase the price of their kerosene products by P1.50 per liter.

Earlier, the oil firms indicated their intention to implement a “one time big time” price adjustment, purportedly to “end the agony” of the transport sector.

Prior to the P3 per liter adjustment, oil firms claimed that they had a P5 per liter under-recovery for diesel for the month of June.

Diesel now three times more costly since Arroyo's 1st SONA - Bayan

07/19/2008 | 02:25 PM

MANILA, Philippines - With the P3 per liter price hike imposed by oil firms on Saturday, diesel will now be three times more expensive than during President Gloria Macapagal Arroyo's first State of the Nation Address (SONA) in 2001, the leftist umbrella group Bagong Alyansang Makabayan (Bayan) said on Saturday.

Bayan said that a week before Mrs Arroyo delivers her SONA, the cost of diesel ballooned to P58.94 per liter, a 306 percent increase from P14.50 a liter in 2001.

"This clearly belies MalacaƱang's claim of better life for Filipinos under the Arroyo (administration), a recurring theme that is expected to be further hyped by the regime towards Arroyo's SONA on July 28," it said.

It said that in 2001, when Mrs Arroyo in her first SONA "vowed to monitor oil price hikes," ordinary jeepney drivers spent only P435 per day.

But now, Bayan sais jeepney drivers need to shell out more than P1,768 just to pay for diesel.

Of the amount, more than P212 will go directly to the government as 12 percent value added tax (VAT), according to the group.

As oil price drops, some analysts wonder if bubble is bursting

07/19/2008 | 10:22 AM

NEW YORK - The price of oil recorded its biggest weekly drop ever, and a gallon of gas finally pulled back from its record high. So is it time to declare the energy bubble popped?

Experts won't go that far just yet.

"It's too early to say we've seen the worst of it," said Tom Kloza, publisher and chief oil analyst of the Oil Price Information Service in Wall, New Jersey "We would be Pollyannish if we believe one week represents a trend."

Still, with oil recording yet another drop on Friday, some industry experts who just days ago thought there was more juice left in oil's meteoric run are reconsidering.

"If this is not the bubble's implosion, than it's a reasonable facsimile," analyst and trader Stephen Schork said in his daily market commentary. "Time will tell. Nevertheless, for the time being we no longer care to hold a bullish view."

Light, sweet crude for August delivery fell 41 cents Friday to settle at $128.88 on the New York Mercantile Exchange — well below its trading record of more than $147 a week earlier.

The average price of a gallon of regular gas fell about a penny for the day, to $4.105 (3.79 liters) according to auto club AAA, the Oil Price Information Service and Wright Express. Diesel prices dipped three-tenths of a cent to $4.842 a gallon (3.79 liters).

Some analysts said a nationwide average of $4 or even lower could be in the offing — almost unthinkable in a summer when there has seemed to be no relief at the pump — although they cautioned that there is no guarantee prices will stay low.

"We're going to see some relief from that relentless march higher," Kloza said.

DoE-DoJ task force to quiz oil firms on P3/liter diesel hike

07/19/2008 | 09:09 AM

MANILA, Philippines - The government will summon representatives of oil companies on Monday for them to explain the reported P3 per liter increase in diesel prices despite the drop in global fuel costs.

Department of Energy Secretary Angelo Reyes on Saturday said a newly formed task force of the DoE and the Department of Justice would look into the new round of oil price hikes, which is the 20th time this year.

"Ngayon meron tayong task force, nag-assign tayo ng prosecutors na may inherent power to summon and issue summons for documents, sa Lunes papatawag natin (Now that we have a task force we will assign prosecutors to summon and issue summons for documents. We'll sic it on them Monday)," Reyes said in an interview on dzRH radio.

Chevron Philippines, Pilipinas Shell Petroleum Corp., Flying V, and Unioil Petroleum Phil. confirmed that they would be increasing the prices of their fuel products. The increases will be effective at 12:01 a.m. Saturday for Flying V and 6 a.m. for Unioil and Shell. Chevron will follow suit at 12 noon.

The increase in the prices of fuel products has become a weekly occurrence in the country. The P3 per liter increase in diesel this weekend is so far the biggest hike imposed by oil companies. Prices of gasoline are also up by P1, while that of kerosene jumped by P1.50 to P2.00.

The prices of diesel and kerosene have gone up 20 times since the start of the year. Total price of diesel per liter has gone up by P24, while that of kerosene rose by P22.50.

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