Sen. Imee Marcos yesterday called on the Department of Energy (DOE) and the oil companies to suspend oil price hikes set for today, November 17, to ease the financial burden of motorists due to the effects of the new coronavirus disease 2019 (COVID-19) and the recent calamities.
This after oil companies yesterday announced they were hiking their prices effective today.
Marcos, who chairs the Senate committee on economic affairs, called for the imposition of price freeze on oil, particularly in provinces where relief efforts are ongoing due to typhoons Quinta, Rolly and Ulysses.
Quoting reports, Marcos said the DoE said it granted local oil price increases because global market prices had spiked on positive news that a Covid-19 vaccine could soon be available.
However, Marcos said that crude oil prices were nowhere near their levels before the World Health Organization declared Covid-19 a pandemic.
“The big three oil companies seem to owe us a discount. Since January, they have lowered diesel prices by less than 40 percent, even when Middle East crude prices went down by more than 82 percent,” Marcos said, referring to Petron Corp., Pilipinas Shell Petroleum Corp. and Chevron Corp.
Marcos said the price of West Texas Intermediate (WTI) crude, one of the main global oil benchmarks, even plunged into negative territory in April.
The OPEC basket benchmark price stood at $70.87 per barrel in early January, plunged to $12.41 in late April, and increased to $41.18 by November 10.
Diesel prices in Metro Manila ranged from P40.25 to P46.08 in early January, P24.63 to P30.56 in late April, and increased to P29.39 to P36.48 by November 10.
Meanwhile, the Department of Energy pegged the latest average Manila price per liter of gasoline (RON95) at P47.97, diesel at P33.73 and kerosene, P36.61.
Shell and Seaoil adjusted per liter prices upward by P1.05 for gasoline, P1.55 for diesel and P1.30 for kerosene.
As of November 10, year-to-date adjustments on fuel prices summed up to a net decrease of P5.67 per liter for gasoline, P10.91 per liter for diesel and P13.89 per liter for kerosene.
Reuters reported that as of Friday last week, Brent crude settled at $42.78 a barrel while US WTI crude futures ended at $40.13 a barrel.
The report quoted John Kilduff, founding partner at Again Capital, as saying that expectations for a vaccine to restore demand for transportation fuels is critical for oil prices.
“Transportation across the board has been so impacted by the pandemic that getting past it would revive demand for those fuels, which is what the petroleum complex needs,” he said.
Analysts also said this week’s price increase could have been higher if not for rising fuel productions in Libya and the US.
According to the International Energy Agency, global oil demand is unlikely to get a significant boost from vaccines until well into 2021. – (R. Africa and J. Macapagal)