Big-time gasoline price rollback eyed next week

National

AFTER two consecutive rounds of hefty increases, gasoline prices could reverse course next week with a rollback of up to P4.20 per liter, while diesel prices are projected to climb after three straight weeks of reductions.

Industry estimates based on the four-day average of the Mean of Platts Singapore (MOPS), the regional fuel pricing benchmark, point to a possible gasoline price rollback of P4 to P4.20 per liter.

Diesel prices, meanwhile, could increase by P0.20 to P0.40 per liter, potentially ending their three-week streak of price cuts.

Jetti Petroleum president Leo Bellas attributed the anticipated gasoline price reductions to improved regional supply as refineries resumed operations following maintenance.

Diesel prices have risen amid persistently low global inventories. Expectations of additional supplies from Russia and the planned release of petroleum stocks by Group of Seven (G7) countries have helped temper the increase.

The G7, composed of Canada, France, Germany, Italy, Japan, the United Kingdom and the United States, agreed to release 100 million barrels of petroleum supplies.

Bellas said uncertainty remains over whether the diesel supply deal between the United States and Russia would result in a meaningful increase in global availability.

Meanwhile, Shell Pilipinas independent director Edgar Chua questioned whether the Philippines could afford to establish a government-managed strategic petroleum reserve, citing the high cost of maintaining emergency fuel stocks.

“It is a good concept, but can we afford it?” Chua said in a Philstar report. This was his response when asked whether Shell was interested in participating in the planned emergency reserve program.

A strategic petroleum reserve consists of emergency stocks of crude oil and refined petroleum products held by the government, private companies or both. These supplies can be released during disruptions caused by geopolitical conflicts, natural disasters and other global shocks to help stabilize supply, moderate prices and ensure fuel availability.

Industry estimates put the cost of establishing reserves equivalent to an additional 30 days of fuel supply at around P30 billion.

Chua cautioned that having a sovereign wealth fund does not necessarily mean the Philippines can afford to establish and maintain a strategic petroleum reserve, which he said is typically within the financial capacity of wealthier countries.(MyTVCebu)