Oil firms lower pump prices by P1 per liter
Euan Paulo C. Añonuevo
Manila Times
Oil firms are expected to reduce rates at the pumps, even as world crude prices recovered because of a hurricane threatening the US Gulf Coast.
In separate announcements Friday, Petron Corp., Pilipinas Shell Petroleum Corp., Eastern Petroleum Corp., Seaoil Philippines Inc. and Unioil Petroleum Philippines Inc. said that they would slash diesel, gasoline and kerosene prices by P1 per liter.
Unioil implemented its price cut at 10 p.m. Friday, while the other oil firms’ are to roll back rates at 12:01 a.m. today.
The cut is the fifth rollback of fuel prices this month, bringing down the cost of diesel and kerosene by P3.50 per liter and gasoline by P5.50 per liter.
Raffy Ledesma, Petron strategic communications manager, said they reduced prices to “reflect the continued softening in international oil prices.”
The prices of imported diesel and gasoline have gone down to $135.37 and $115.41 per barrel from $168.01 and $135.27 per barrel, respectively.
Energy Secretary Angelo Reyes earlier said he expected oil firms to implement further pump adjustments in light of the lower average price of oil in August.
But he declined to say how much fuel prices should be adjusted, as “market forces” will ultimately determine the rates.
World prices recover
Oil prices rebounded in Asian trading on Friday as traders kept a close watch on a storm moving toward the Gulf of Mexico and key oil installations, analysts said.
In afternoon trade, New York’s main contract, light sweet crude for delivery in October, rose $1.51 to $117.10 a barrel after a drop of $2.56 in New York on Thursday.
Brent North Sea crude for October gained $1.28 to $115.45 a barrel. The contract shed $2.05 Thursday in London.
“Still we have to worry about the hurricane’s effect on this market,” said Ken Hasegawa, manager of the energy desk at Newedge Japan brokerage in Tokyo.
He said the storm should support prices for up to three more days.
About a quarter of US crude oil installations are located in the Gulf of Mexico.
Tropical Storm Gustav was threatening to regain hurricane strength before entering the Gulf over the weekend. It was expected to make landfall in Louisiana and Texas on Monday, according to the US National Hurricane Center.
British oil group BP and US rivals ConocoPhillips and Shell said they were evacuating workers from their energy installations in the Gulf of Mexico ahead of the storm.
The threat of Gustav raised grim memories of the 2005 hurricanes Katrina and Rita that damaged or destroyed about 165 of about 4,000 oil platforms in the Gulf.
Mike Fitzpatrick at MF Global said that “even if the damage from the approaching storm is fractional it could still be significant” because of limited capacity.
“The environment of sparse capacity means that every barrel of oil lost to the marketplace will be felt, particularly as the Northern hemisphere’s winter is just around the corner,” he said.
Hasegawa said the market could also get support from the closing of short positions ahead of the Labor Day holiday on Monday when US trading is closed.
World oil prices have sunk from record highs above $147 a barrel in early July after surging from $100 at the start of the year.
Analysts say the struggling economy in the United States, the world’s biggest energy consumer, has curbed demand for oil.
– With AFP
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