Constant Weekend Rise at the Gas Pump

[Monseratto]

Dang, dami aangal dito. Tapos yung peso tuloy yung ang bagsak vs dollar...

'More oil price increases in coming months'

Expect more rounds of oil price increases in the coming weeks as crude cost in the world market has become "unpredictable" and is "rapidly" moving up, an oil giant spokesperson said Saturday.

"We don’t know about the amount, but it’s almost certain that there will be more increases," Virginia Ruivivar, Petron Corp. spokeswoman, told ANC television.

Ruivivar said that instead of abiding by the P0.50 increase agreement, oil companies had to implement a P1 increase to be able to catch up to the rapidly increasing crude cost in the international market.

She also cited the depreciating peso as the reason for the latest price adjustment. The Petron official said the strong peso earlier served as a buffer to the increasing world oil prices,.

The P1 increase in petroleum product prices took effect 6 a.m. Saturday. The increase followed a series of oil price increases last month.

"In a situation like that, if you don’t make adjustments the local supply will dry up," she added.

Underrecoveries
Ruivivar said the same reasons will be brought up by Petron and other oil companies during Monday’s meeting with Energy Secretary Angelo Reyes.

Reyes said executives of oil companies have to "satisfactorily" explain the price adjustment.

Ruivivar said oil companies will not just satisfactorily explain the latest price adjustment.

"We can actually easily justify the increase," she said, adding that oil companies had not finished its recovery from past increases of crude’s world price.

Unpredictable
Petron’s spokeswoman said oil companies cannot guarantee when the prices of oil in the world market will start going down.

"It’s very difficult to tell because it’s has become unpredictable… Unpredictable in the sense that you couldn’t say that it will stabilize in June," she said.

Ruivivar said that before, oil companies predict the price of oil by the seasons.

However, she said the trend has shifted because the prices of oil are now not dictated by the law of supply and demand.

She said that because of the weakening dollar, investors were encouraged to move into commodity.

"It’s clearly, basically the shift of the funds to commodities. [Investors] are buying commodities and that’s increasing oil prices," she said, adding that the shift has also affected the prices of food.

Ruivivar, meanwhile, assured that if oil companies will immediately implement price rollbacks once they see "any sign that the prices has moved down."

World oil prices have eased a bit after hitting an all-time high of almost $120 per barrel.

http://www.abs-cbnnews.com/topoftheh...StoryId=117039

[ans_lim168]

I'm not shocked to see the prices of fuel will breach the 50 php per liter mark by mid year....we just have to adjust to what the circumstances are presenting to us...It's time to plan our trips and the use of our vehicles wisely...with the problem of fuel prices and global warming now upon us...we might as well look at the condition of our rides to see to it that it's well maintained...that way we could cut a little expense on our fuel consumption plus we contributed less to global warming...

[jinrai]

tama, the price increase in fuel is way beyond our control. all we can do is find other alternatives.

looks like the lpg industry will be getting more customers from the private car owners. i just hope they can bring the prices of their kits and services down to a more affordable level

[jang]

How about switching to diesel instead of gas? I read in the papers that gas is subsidizing the price of diesel. Plus, diesel engines are more fuel efficient than gas.

[enzo18]

Oil is now $120 a barrel.
Petron-BPI offers 24-hour hold for old prices; and 3% rebate.
Shell-Citibank offers 5% rebate now.
Caltex-HSBC offers 3% rebate.
Hay naku!

5% rebate is for Shell Citibank Visa, sa Shell Citibank MC ba 5% din?

[number001]

Philippine Star May 4, 2008 Headline.

Pump prices up P1 per liter
By Donnabelle Gatdula
Sunday, May 4, 2008
ILOCOS NORTE – Energy Secretary Angelo Reyes urged the country’s petroleum players to explain their move to raise pump prices by P1 per liter yesterday.

“We will summon the presidents of Shell, Petron, Chevron and other independent oil players to explain to the Department of Energy and to the public why they need to increase their prices by P1 per liter,” Reyes told reporters attending a wind power project briefing here.

Reyes said he would summon representatives from the oil firms for a meeting tomorrow to explain their side.

Reyes said the sudden increase under a deregulated market would definitely create negative feedback from consumers.

“They have to come up with an explanation on the reasonableness of their move to raise prices,” he said.

This is the first time that the oil firms will be jacking up their prices by P1 per liter.

So far, this is the ninth increase since March this year. The oil firms implemented two rollbacks in February but prices began to shoot up in March, prompting oil players to implement a 50-centavo increase every week.

Since March, oil firms have raised their diesel prices by P3.50 per liter and P4.50 per liter for gasoline.

At the same time, Total Philippines said aside from the P1 per liter increase in pump prices, it will also adjust the prices of their LPG and autoLPG products by P1 per liter.

Petron and Shell did not say if they would increase LPG prices.

True to their earlier pronouncements, oil companies raised their pump prices anew but this time at P1 per liter.

Semi-government Petron Corp., also the country’s largest oil refiner, said the latest price adjustment would reflect the continuing rise in crude prices abroad.

Dubai crude, the benchmark being used by Petron in pricing its product, averaged $103.41 per barrel for April or $6.65 per barrel higher than the March average of $96.76 per barrel.

Petron noted that Dubai crude average reached an all-time high of $110.20 per barrel last April 28.

Chevron Philippines, an oil importer, on the other hand, said they have to jack up prices due to the continued rise in finished petroleum products in the region.

Oil importers use Mean of Platts Singapore as gauge for their pump prices.

Earlier, oil companies said they need to raise prices by P6 to P7 per liter in the next weeks to recoup their under-recoveries.

The move of the oil firms to increase pump prices by P1 per liter, however, runs counter to their earlier commitment to make the price adjustments on a staggered basis and in small amounts to cushion the impact on consumers.

One option earlier being supposedly looked at by oil firms before they implemented the P1 price hike was to jack up prices by 50 centavos per liter twice a week.

With the decision to raise pump prices by P1 per liter, it seemed that the oil firms decided to take the painful option of adjusting their prices once a week instead of frequent but piecemeal adjustments, completely disregarding the possible impact of such a move on consumers.

The oil companies said the continuing rise in crude prices forced them to implement the P1 increase since it will take time for them to recover their losses if they would continue to adhere to the earlier commitment of small and frequent incremental price adjustments.

With the latest oil price hike, the price of premium gasoline now breached the P50 per liter mark.

Reyes said he would review the oil firms’ return on equity (ROE) to measure their actual profits.

Reyes believed that the ROE would indicate if oil firms are using “creative accounting” in calculating their level of profitability.

Sen. Manuel Roxas, on the other hand, urged the DOE to force oil companies to be more transparent.

Roxas made the call as he reiterated his proposal for the immediate suspension of the expanded value-added tax on oil and other petroleum products.

He said these moves must be done in light of calls to increase fares, to the detriment of commuting public.

“While we don’t want fares to increase, our transport sector is already suffering due to price hikes. Pump prices have increased eight times already,” he said.

Roxas, chairman of the Senate committee on trade and commerce, said the recent “dip” in world oil prices from an all-time high of $120 should be no cause for complacency.

He said a dip in world crude prices should not mean the DOE should be complacent against any abuse in increasing prices.

“Back here at home, the threat of further pump price hikes remains. Oil companies are still bent on hiking this up to P5 to P7 more per liter. There is the possibility that prices of gasoline and diesel can reach P50 per liter within this year,” Roxas said.

Motorists and commuters raised fears that the latest round of increase in fuel prices, compounded by the rice crisis would trigger security problems.

Authorities, meanwhile, gave assurance that the seemingly endless increase in fuel prices has not reached the point to affect national security.

Philippine National Police (PNP) spokesman Senior Superintendent Nicanor Bartolome said the sudden increase in gasoline and fuel products has not reached the flash point to trigger riots and disturbances.

Bartolome said the PNP would do its part to monitor the developments in the national threat board.

“So far the problem is still confined within the transport sector,” he said. – With Aurea Calica, Jaime Laude

[1D4LV]

How about switching to diesel instead of gas? I read in the papers that gas is subsidizing the price of diesel. Plus, diesel engines are more fuel efficient than gas.

government is subsidizing the cost of diesel for PUVs only. that is the reason why there are PUV lanes sa mga gas station.

it would depend on the diesel engine. kung Nissan Patrol ba naman ang gamit mo, hindi ka din makakatipid.

time to get a Getz 1.1 Gas or a Getz 1.5 CRDi. hehehehe.

[tidus1203]

Para lang naman sakin ah it might not apply to you pero I will just bear na lang the high prices siguro iwas unecessary lakwatsa na lang muna. The idea of trading in my car for other diesel cars might be more expensive for me in the long run due to maintenance costs and my relatively low mileage use. The thought of converting my car into LPG seems appealing as well but given my mileage as discussed above its not worth it or at least it will take a long time for me to recover the high upfront cost of LPG conversion. For reference my Civic will turn 3 months in May 11 and at this very moment my odometer shows 1250km exactly so more or less I only use the car 400-500km a month. My other cars probably also run that much too maybe a little more pero definitely less than 600km a month....

[CVT]

I received a bunch of cartoon drawings today depicting humor on the issue of high prices of petrol.... Here's one that I especially like....

5909:burn:

[ringostarr]

speculating talaga yan mga oil companies na yan. nag-depreciate ang peso nagtaas sila pero nun nag-appreciate ang peso, di sila nagtaas

obvious naman kumbakit nagtataas mga oil companies locally, bec DEMAND IS LOW!

bakasyun eh, what can you expect? no student commuters therefore less PUVs on the road, less PUV on the roads, no Traffic!

and also no classes, therefore no baon, therefore no panggastos sa malls, therefore wala gano delivery and importation. alam naman natin it's the age bracket 15-28 ang nagpapagalaw ng Malls.

sa private motorists naman, halos 30% of private car owners are abroad or in vacation kaya hindi nagagamit tsikot nila.

sobrang magpang-isa mga executives ng mga oil players na yan. masyadong opportunista, product kasi ng rebel 60's and 70's kaya walang pakelam.

i wouldn't be surprised pagdating ng June baba ang presyo bec. volume is high na eh

[meledson]

Sa news kanina, hanggang june pa daw ang weekly na pagtaas ng gas. parang PHP 6.00 pa ang hahabulin sa diesel.

[[archie]]

^^ oo nga daw, ive heard it sa news din... tsk tsk tsk... prices are really starting to get real expensive for the average juan...

i myself is considering the fact na magcommute na lang starting next week. i cant believe it can rise this fast.

[meledson]

^^ oo nga daw, ive heard it sa news din... tsk tsk tsk... prices are really starting to get real expensive for the average juan...

i myself is considering the fact na magcommute na lang starting next week. i cant believe it can rise this fast.

Akala ko mali ang rinig ko, tama pala

[tidus1203]

Nako we might be coming near that sweet spot (where demand suffers and prices go down) I was talking about where people would start to commute. Even my office mate here is in the verge of doing that as well...

[Redman7]

According to my bubuwit.....aabot ng Php60/L by august....
(with the going rate of Php1.00 / wk......mukhang tama nga.... end of march ko pa narinig kay bubuwit)..

[1D4LV]

i was just listening to the news this morning.
ang under-recovery na hahabulin pa ng mga gas stations is Php 7.00. so that means, the cheapest unleaded gas will go up as high as Php 56.00/liter.

this is assuming that the cost of world crude will not go up, but it does.
medyo realistic nga yung sabi ni redman na baka mag Php 60.00/l by august. tapos, during the winter season sa states and china ng mga november - january, tataas pa lalo ang price nya because of the demand.

are we seeing a Php 70.00/liter by next year?

[meledson]

Aray. Kinakabahan na ako dito.

Taas presyo ng gas, taas pamasahe, taas bilihin, suweldo?, ewan

[1D4LV]

Aray. Kinakabahan na ako dito.

Taas presyo ng gas, taas pamasahe, taas bilihin, suweldo?, ewan

ayan pa ang isang problema.

taas presyo ng fuel which will result in higher cost of basic consumables, higher cost in electricity, higher fare BUT:

its quite risky for the part of business owners and employers to increase salaries. why? because of the rising cost of commodities, consumer power will be decreased resulting in less sales from businesses. business owners will have to shoulder the cost of salary increase as well as other benefits (like SSS employer's contribution, 13th month) from their own pockets. the risk here is that UP TO WHEN CAN THESE EMPLOYERS SHOULDER THESE COSTS? This will eventually lead to loss of jobs and eventually closure of business, which, will also lead to loss of government collection and revenues from business taxes and inflation.

i don't know if this scenario is feasible wherein to counter these, government should immediately implement lower income tax bracket mechanism for the workers, even though government may experience a decrease in collection revenues. that way:

a) businesses can still operate, even though sales could be minimal. at least, they are still operating and will not cause to lose jobs;
b) workers can enjoy higher take home pay to counter the increase of consumer goods.
c) suspend or decrease VAT rate in some products and services (like lower VAT on fuel and electricity and some basic commodities like canned goods, etc. and increase VAT rate on sin products like cigarettes, wine, beer, softdrinks, internet connectivity, etc. that way, balanced yung collection ng VAT where yung basic needs are lowered and the luxuries are increased. para di rin maapektuhan yung VAT collection revenue.


these solutions can be temporary and can be re-aligned back to pre-crisis levels (the tax brackets as well as VAT rates).

imho, pero medyo OT.

[[archie]]

Nako we might be coming near that sweet spot (where demand suffers and prices go down) I was talking about where people would start to commute. Even my office mate here is in the verge of doing that as well...

oo nga sir, i think the "sweet spot" is nearing na talaga. i never, in my wildest dream thought of being a daily commuter after having my car pero with the constant rise of gas, im left with no choice.

kahit kaya ko pa to pay gas, gusto ko na din masanay ulit magcommute if the situation gets any worst.

hay, mas mura pa gas sa USA and to think the way of living there is more expensive than here in our country.

[uls]

Just look at the movement of oil price

it hit $120, dropped to $112, and hit $120 again in just a few days!

It's obvious fundamentals are not responsible for the price movement.

Notice when US stocks move up, oil goes down.

And when stocks drop, oil goes up.

So in short, speculators are moving large sums of money in and out, to and from the stock and commodities market.

There's still a lot of volatility out there.

Speculative money has no long term parking space.

Palipat-lipat ng parking... kung saan pwede kumita, dun magpapark... pero hindi ipapark ng matagal.