Fuel price rollback or increase on June 30 as Middle East tensions return

MANILA, Philippines – Pump prices are going to have a slight rollback or an increase starting Tuesday, June 30.

In a press conference on Monday, June 29, Energy Secretary Sharon Garin announced the following permitted price range adjustments for the week of June 30 to July 6:

• Gasoline – from a decrease of 10 centavos per liter to an increase of up to P1.90 per liter
• Diesel – from a decrease of P1.16 per liter or an increase of up to 84 centavos per liter
• Kerosene – from a decrease of 78 centavos per liter to an increase of P1.22 per liter

Before the latest adjustments, the Department of Energy’s (DOE) price monitoring showed common retail prices in Metro Manila at P73.00 per liter for gasoline RON95, P72.00 per liter for gasoline RON91, P69.10 per liter for diesel, and P97.50 per liter for kerosene for the week of June 23 to 29.

The price hike follows last week’s major rollback, when pump prices went down by up to P5.90 per liter for gasoline, P11.04 per liter for diesel, and P11.82 per liter for kerosene.

Last week’s rollback came after global oil prices eased on hopes that the slowdown in fighting between the US and Iran would lower supply risks in the Middle East, including concerns over the Strait of Hormuz. The narrow waterway is one of the world’s most important oil shipping routes, so any threat to vessel traffic there can ripple through fuel prices.

But those hopes have since been tested by renewed hostilities. Oil prices rose again after fresh exchanges between the US and Iran reignited fears of disruption in the Persian Gulf and slowed shipping traffic through the Strait of Hormuz. The US and Iran have since agreed to halt attacks and renew talks, but this may not yet have been factored into this week’s fuel prices.

The DOE had warned in its latest oil monitor that while crude prices had softened on expectations of improving Hormuz flows and the possible return of Iranian supply, declines could still be limited by low inventories and uncertainty beyond the temporary ceasefire period.

The same DOE monitor said Dubai crude prices fell by around $14 per barrel during the June 15 to 19 trading period. International prices of gasoline, kerosene, and diesel also decreased by around $12 per barrel, $23 per barrel, and $21 per barrel, respectively.

However, the DOE also noted that fresh military exchanges had “reignited geopolitical concerns,” driving a rebound in crude prices after early-week price action had been weighed down by expectations of a US-Iran peace deal.

Despite last week’s rollback, local pump prices remain well above levels seen before fighting between Iran and US-Israeli forces erupted on February 28. In the last full week before the conflict, DOE data showed common retail prices in Metro Manila at P56 per liter for gasoline RON95, P54.70 per liter for gasoline RON91, P55 per liter for diesel, and P83.47 per liter for kerosene.

The Philippines is a net importer of petroleum products, making local pump prices vulnerable to global oil price swings and disruptions in international supply routes. – Rappler.com