Good News: Big Rollback on Fuel Prices Expected Next Week
With the average price of oil per barrel finally going down, the Department of Energy is expecting to see fuel prices drop next week.
After weeks of fuel price hikes, Filipino motorists are finally given some much-needed relief as the Department of Energy (DOE) announces the possibility of a fuel price rollback next week.
This can be linked to the average price of oil per barrel in Dubai going down. From $122.61 per barrel, the price has dropped to $104.79 per barrel over the past week. And according to DOE Secretary Alfonso Cusi, if this trend were to keep up, we can expect prices to go down by around PHP 5 per liter for gasoline and about PHP 12 per liter for diesel—effectively negating this week’s price hike.
Reasons Behind Dropping Oil Prices
According to a report by CNN Philippines, the reason behind the decrease in oil prices can be attributed to various world events like Ukraine veering away from its plan of becoming a member of the North Atlantic Treaty Organization (NATO).
“The price of crude oil is actually very volatile, but it kept on increasing because of the sustained pronouncement from UK, US, European Union [on] sanctions against Russia,” the Department of Energy’s Oil Industry Management Bureau (OIMB) Director Rino Abad explained.
“But recently there was a statement from Ukrainian President [Volodymyr Zelenskyy] that they’re not interested anymore in joining NATO, [prompting] Russia to respond that they’re now willing to sit down with Ukraine and US for talks,” he added.
Aside from the ongoing conflict between Russia and Ukraine, the growing COVID-19 cases in China and various countries also played a role in the changing oil prices. “[This was] coupled with recent surges of COVID-19 in Singapore, but notable in China, which imposed a massive lockdown,” Abad explained.
“Those are the two main [reasons] this week in the recent report that immediately provided us reasons why the crude oil prices immediately went down from a day’s transaction, last week versus yesterday morning.”
An Optimistic Forecast
Although there are still no exact figures in their forecast, Monday’s trading will likely reflect these changes next Tuesday. The result is what Abad describes as “a massive rollback [that] would wipe out the entire increase we experienced this week.”
To date, Caltex, Cleanfuel, Petron, Total, and Unioil’s diesel prices increased by PHP13.15 per liter, while gasoline prices went up by PHP 7.10 per liter. Likewise, Caltex and Petron raised kerosene prices by PHP 10.50 per liter this week.
Amid these price hikes, the government has given additional aid through a recently-approved proposal of a PHP 200 monthly subsidy to poor families. On the other hand, public transport drivers are waiting for the promised PHP 6,500 fuel subsidy from the government, though they claim that this will not last them a week.