Local oil firms are implementing big price cuts today, March 21, for the third consecutive week as US crude inventories remain on record high, raising concerns a deal by the Organization of the Petroleum Exporting Countries’ (OPEC) to curb a global glut will work.
Phoenix, PTT, Eastern Petroleum and UniOil cut their prices by P1.10 per liter on diesel and P0.80 per liter on gasoline.
Shell and Petron slashed prices by P1.10 per liter on diesel. P0.80 per liter on gasoline and P1.20 per liter on kerosene.
According to the Department of Energy’s latest oil monitor, the current average price of diesel is at P30.95 per liter and gasoline is at P43.70 per liter. Compared to prices of diesel and gasoline at the start of the year, current prices are still higher, 0.16 percent higher and 6.4 percent lower, respectively.
From figures in mid-March 2016, the current price of diesel is 34.5 percent higher while that of gasoline is 13.2 percent higher.
According to a report from Reuters, oil prices slipped last week due to a build of more than 2 million barrels at the Cushing, Oklahoma delivery point for US crude futures.
Brent crude ended last Thursday’s session 7 cents lower at $51.74 a barrel, recovering from Tuesday’s drop to $50.25, its lowest since Nov. 30 when OPEC announced its supply accord. The price is still nearly $7 below January’s post-deal peak of $58.37.
US light crude meanwhile settled 11 cents lower at $48.75 a barrel.
However, analysts say that prices may get a lift after reports that Saudi Arabia energy minister, Khalid Al-Falih mentioned that OPEC production cuts could be extended if inventories remain above average.
OPEC and non-OPEC members’ agreed to slash their production by around 1.8 million barrels a day in their latest meeting in Vienna last year that boosted the current price levels of petroleum products.
Saudi Arabia committed to lower its output by 486,000 barrels a day to 10.058 million a day while Iraq agreed to cut by 210,000 barrels a day. On the other hand, the United Arab Emirates will reduce output by 139,000 barrels a day, Kuwait by 131,000 barrels a day and non-OPEC member Russia will cut by as much as 300,000 barrels per day.