As global oil prices edged up to $ 73 a barrel by the end of the trading week, Filipino consumers will be in even more of a hurry next week, with domestic pump prices expected for larger increases.
Based on the calculations of the oil companies, gasoline prices could climb by 0.70 to 0.80 P per liter; while the prices of diesel and kerosene from 0.65 to 0.75 P per liter.
Since the start of the year, a follow-up report from the Department of Energy (DOE) has shown that oil prices are already showing a net increase of 10.00 pesos per liter for gasoline, from 8.55 pesos. per liter for diesel and 7.00 pesos per liter for kerosene.
Added to the string of bad news on the price of petroleum commodities is the rising value of the US dollar, which could further weigh on the purchasing power of countries, like the Philippines, which have heavily imported their oil needs.
Following the Federal Reserve’s decision last week to raise headline inflation expectations, the US dollar had climbed to P48.43 on Friday, June 18, meaning that it then becomes more expensive for the Philippines to buy their oil needs in the coming weeks and months.
On the international market, the industry predicts that oil prices could exceed US $ 70 per barrel as many countries expect a hawkish economic recovery from the pandemic.
And these economic recoveries, experts say, are occurring against a backdrop of insufficient funds and underinvestment in new oil drilling resulting from last year’s strike of the global Covid-19 health crisis.
Based on projections from the International Energy Agency (IEA), there will be an overall tightening of supply as global demand is expected to increase by 3.1 million barrels per day next year.
Essentially, the Paris-based Global Energy Think Tank noted that demand for oil has now accelerated to pre-pandemic levels as a ‘gap’ between supply and demand could begin. to manifest by the second half of this year.
On the supply side, producers outside of the Organization of the Petroleum Exporting Countries (OPEC) enclaves and its alliance – and this will be led by Brazil and Norway are expected to increase production. will meet again on July 1 to assess market conditions and determine whether it will be necessary to send more oil to the markets.
In the regional market, the outlook has remained “fragile” – particularly in Southeast Asian markets – due to the persistent problem of increasing Covid-19 infections.
Across Asia, there has been a tight supply due to the closure of a large refinery in India and delayed shipments of raw materials from other global producers.
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