Fuel prices are expected to increase anew next week, by as much as P0.60 per liter, on supply risk due to geopolitical issues between the U.S. and Iran, among others.
Citing price developments based on the Asian benchmark and the movement of foreign exchange as of Thursday, Jetti Petroleum president Leo Bellas, in a report Friday, Feb. 20, said diesel prices may increase between P0.40 to P0.60 per liter and gasoline, up to P0.10 per liter.
“This week’s oil price movement is primarily due to the market’s reaction to developments between the US and Iran by pricing in the additional risk of supply disruption in the event of conflict,” he said.
Bellas said the Mean of Platts Singapore (MOPS) prices have jumped by over 5 percent from the Feb. 16 settlement as “concerns over military activities in the region have increased the likelihood of US strikes on Iran and decreased the prospect that the conflict will be resolved through diplomatic means.”
“While this week’s gasoline MOPS prices have actually softened due to healthy regional inventories and supply, rising freight and premium due to geopolitical risks have offset the prospect of a potential price rollback,” he said.
“Helping temper the potential increase in domestic prices this week is the stronger (Philippine) peso against the US dollar,” he added, referring to the strengthening of the local currency to as much as 57-level against the U.S. dollar.
Oil prices have been on the rise across-the-board for six weeks, with the jump this week at P1.20 per liter for gasoline, and P0.60 per liter for diesel and kerosene.PNA
