Inside out

Random musings in and outside the news

‘Big 3’ hiking gas prices P0.75/L

Posted by Abi Kwok on January 24, 2009

Diesel, kerosene down P0.50/L

By Abigail Kwok, Amy R. Remo
INQUIRER.net, Philippine Daily Inquirer
First Posted 15:09:00 01/23/2009

Filed Under: Oil & Gas – Downstream activities, Consumer Issues

MANILA, Philippines—(UPDATE 2) Major oil players Pilipinas Shell, Chevron, and Petron will increase their gasoline prices by P0.75 per liter effective Saturday, officials said.

Shell vice president for communications Bobby Kanapi and Chevron communications manager Toby Nebrida said price changes will take effect 12:01 a.m.

Petron, meanwhile, will hike prices effective 6 a.m. Saturday, its spokesperson, Virginia Ruivivar, said.

Shell and Chevron also announced Friday that they had increased the prices of their E10 line by P1 a liter.

However, the firms, along with PTT Philippines, have again slashed the prices of diesel fuel and kerosene by another 50 centavos a liter, bringing total price cuts for these products to P2 a liter since the beginning of the year.

According to data from the Department of Energy, the regional benchmark Dubai crude has climbed to an average of $45 a barrel as of Jan. 21, from an average of $41 a barrel last month.

The price of unleaded gasoline based on the Mean of Platts Singapore (MOPS) benchmark for refined petroleum products also increased to a $50-a-barrel average in the first 21 days of the month, from the December average of $41 a barrel.

MOPS-based diesel remained flat at an average price of $61 a barrel from Jan. 1 to Jan. 21, compared to last month’s $61 a barrel.

Kanapi said the latest price adjustments reflected the week’s movements in product prices, including trends in international oil prices and foreign exchange.

“The implementation of price adjustments is aligned with the company’s aims of moving towards greater pricing transparency,” Kanapi said in a statement.

Kanapi also disputed the claims of the Consumer and Oil Price Watch, particularly that about hedging and purchase of forwards contract under lower New York Mercantile Exchange (NYMEX) pricing conditions.

“Firstly, oil prices in the Philippines are not benchmarked on the NYMEX. Secondly, PSPC in its long years of operations, has consistently abided by its business principles, which covers adoption of a global control framework and risk management,” Kanapi said.

“To recommend spot hedging and buying forward contracts in order to ensure lower prices, therefore, is not only simplistic but also baseless. It also disregards the company’s commitment and ability to effectively manage its business,” Kanapi added.

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