The Department of Energy (DOE) has called on local oil players to come up with plans that will mitigate increases in the prices of fuel amid gloomy supply outlook in the global market in the fourth quarter.
The DOE also reminded oil firms to ensure their compliance with the minimum inventory requirement (MIR) as contained in Executive Order No. 134.
DOE Department Circular No. 2003-01-001 prescribes the MIR volume equivalent to 15 days of supply of petroleum products except liquefied petroleum gas whose minimum requirement is seven days.
Refiners are required to maintain MIR equivalent to 30-days worth of supply, consisting of both petroleum crude oil and refined petroleum products.
The country only has one refinery, Petron Corp.’s 180,000- barrels- per- day facility in Bataan.
The Oil Industry Management Bureau (OIMB) attributed the looming oil price increases in the global market to the aggressive demand in the fourth quarter that is seen to reach as much as 103 million barrels of crude oil per day (mbpd) against current supply of 103.22 mbpd.
The DOE said not enough additional supply from the Organization of the Petroleum Exporting Countries as well as the slow progress between the United States and Iran in the possible lifting of trade sanctions from the latter can also lead to tight global crude supply.
Other factors cited by the OIMB are: the continued trade sanctions against Venezuela; the increased economic activity in the fourth quarter of the year as developed countries continue to post high vaccination rates and; the stocking up of inventories for the winter season.
“The DOE will continue to closely monitor global oil supply and price movements. As always, we are working with the downstream oil industry players to ensure that all mechanisms to protect our consumers against the impact of such developments as much as possible,” said DOE Secretary Alfonso Cusi.
Data from the DOE showed closing inventory of crude and finished products as of June 30 is equivalent to a 13-day supply or 910 million liters including in-transit volume with finished products equivalent to 26-day supply or 1,726 million liters.
For the same period, total crude oil and finished product available supply is 39 days equivalent to 2,636 million liters.
