Caltex, Eastern Petroleum hike prices by 40¢

Caltex Philippines Inc. and Eastern Petroleum Corp. increased their pump prices by 40 centavos per liter, yesterday a few days after Petron Corp., Totalfinaelf Philippines Inc. and Pilipinas Shell Petroleum Corp. decided to raise the prices of their petroleum products.

Caltex increased its LPG (liquefied petroleum gas) price along with the price adjustments of Petron and Total early this week.

Eastern chairman Fernando Martinez said "the oil price hike was prompted by the higher acquisition cost as reflected in by the Mean of Platts Singapore (MOPS) and the continuing depreciation of the peso."

Dubai crude, the benchmark used by major oil companies, has averaged $27.66 per barrel as of Aug. 26 from $26.72 per barrel in July and $25.51 in June. The foreign exchange rate hit an average of P55 to a dollar as of Aug. 26 compared to the July average of P53.77 to $1.

Prices of finished petroleum products based on MOPS, on the other hand, have significantly risen over the months.

The price of unleaded gasoline based on MOPS averaged $37.43 per barrel, up from $34.62 per barrel.

Diesel, on the other hand, has averaged to $32.58 per barrel from $28.98 per barrel. New oil players source all their products from imports.

The major oil companies have also been relying more on imports because of the stringent CAA standards on gasoline and diesel.

Energy Secretary Vincent S. Perez said Caltex, Eastern the volatility in domestic crude prices is only temporary.

"We assure everyone that the increase in oil prices may only be temporary given the market condition. We note that this year, local oil prices have also been cut by about P1.50 per liter for gasoline and diesel and P1.10 per liter for kerosene," the energy chief said.

Perez asked the consuming public to exercise their power of choice. "We encourage our consumers to be vigilant and exercise their power of choice in their purchases because other oil firms have maintained the same level of prices and do not necessarily increase prices at the same levels."

Last Aug. 20, Caltex initiated an increase in its pump prices by 30 centavos per liter and a day after rolled back prices when other oil players decided not to follow suit.

Oil companies have warned of impending oil price increases which are expected to last in the next few weeks as world crude prices continue to soar and the peso continues to depreciate.

The last increase in local pump prices was in March 2003 at the height of speculations about the US-Iraq war.

During that time, the price of gasoline rose by 80-centavo per liter and diesel by 70-centavos per liter. World oil prices, however, immediately fell after the attack on Iraq. Local pump prices subsequently dropped in the succeeding months.

Between March to May 2003, oil companies have cut pump prices by five times or equivalent to P1.50 per liter for gasoline and diesel and P1.10 per liter for kerosene.