February 18, 2018, 1:31 am
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Oil firms roll back prices

After six consecutive weeks of price hikes, oil prices are down due to renewed concerns about rising crude supplies in the global market.

Shell and Seaoil rolled back the prices of diesel by P1.30 per liter, gasoline by P1 per liter and kerosene by P0.85 per liter.

Eastern Petroleum and Phoenix adjusted prices of diesel by P1.30 per liter and gasoline by P1 per liter.

Petron is reducing its prices by P1  per liter for gasoline,P1.30 per liter for diesel and DieselMax, P0.85/li for kerosene. 

Based on the Department of Energy’s latest oil monitor, the current average price of diesel is  P41.40 per liter, gasoline,  P52.92 per liter  and  kerosene,   P47.75 per liter.

A Reuters report said  as of last Friday, US West Texas Intermediate crude settled to $1.95, down  3.2 percent, to $59.20, the lowest settlement since December  22 while brent futures fell $2.02 a barrel, or 3.1 percent, to $62.79 a barrel, its lowest settlement since December 13.

In the same report, Reuters quoted  oil services company Baker Hughes as saying  total US onshore rigs rose by 26 to 791, the highest since April 2015 and the biggest one-week rise in a year as drillers have added rigs as oil prices rallied through mid-January.

Aside from more drillers in the US, the market was also pressured by weak stock market as oil is inversely correlated with the dollar which has strengthened as equities markets slid.

 “The idea that it is back up and running normally, combined with the data that show US production is rising, contributes to the overall idea that US production could offset cuts by OPEC,” said Gene McGillian, director of market research at Tradition Energy in Stamford, Connecticut ,  in the report.

 Investors are also worried  rising US crude production will overwhelm efforts by OPEC and other producing nations to cut supply. 

The fears were boosted by OPEC member Iran which announced it would boost production within the next four years by at least 700,000 barrels a day.

 OPEC lowered its production in 2017 and  is seen to maintain output cuts for the whole of 2018 to help bring oil stocks down to their five-year average. 

OPEC and Russia together produce over 40 percent of global oil supply at present.
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