Pump prices are going down this week.
Oil firms said Monday that they will slash gasoline prices by P0.60 per liter, diesel by P0.30 per liter, and kerosene by P0.60 per liter.
The new round of oil price reduction will take effect at 6 a.m. of Tuesday, June 6.
This was announced by Petron, Shell, Caltex, PTT, Phoenix, Total, Unioil, and Seaoil. Cleanfuel, meanwhile, will implement its new pump prices at 12:01 a.m.
Last week, oil companies implemented a per liter increase of P1.10 for gasoline, while the price of kerosene has dropped by P0.60 per liter. There was no movement effected on the price of diesel. These price adjustments resulted to a year-to-date net decrease for kerosene at P6.75/liter, and net increase of P6.10/liter for gasoline. Diesel remains at a net decrease of P5.05/liter.
The oil price increase last week was mainly due to an increase in the price of Dubai crude by around $1.25 per barrel (bbl), the Department of Energy (DOE) said. MOPS gasoline also increased by about $2.80/bbl contrary to MOPs kerosene that decreased by nearly $1.00/bbl. MOPS diesel remained at similar level as the previous week.
The local oil industry uses Mean of Platts Singapore (MOPS) as benchmark for pricing of local products. Before, the country uses Dubai crude. However, this translates to one to two months lag time in reflecting the cost of products as it entails three weeks of travel time and another week or two for refining the crude and transporting the products to the pump.
The shift to MOPS was undertaken to become more responsive to the movements in the international market and local demand for fuel products. Basing price of products on MOPS will only entail five days for importation travel time and transfer to the pumps.
According to the DOE, there is a roughly a P1/liter increase or decrease in domestic oil price for every $3 change in MOPS.
