Oil prices seen to go up by 80¢/liter

Domestic oil prices are likely to go up by an average of 80 centavos per liter within this month, industrialist Raul T. Concepcion said yesterday.

In a press briefing, Concepcion said he is hoping that the oil companies could delay the implementation of another oil price hike.

"I hope they can delay it. But definitely, they will have another increase within the month," he said.

The oil firms have raised the price of their diesel products by 30 centavos per liter last Jan. 3 to recover the cost from the impact of the compliance to the new diesel specifications under the Clean Air Act (CAA).

Concepcion, who is also chairman of the Consumer Oil Price Watch (COPW), said the latest 30-centavo per liter increase is just a "one-time" adjustment.

He said the expected price hike this month is brought about by the increase in total crude cost, after taking the freight, premium and insurance expenses, in December compared to November of $0.98 per barrel.

He also noted that the price of blended gasoline and diesel imported by the oil refineries from the region to comply with the requirements of the CAA increased by $3.83 for gasoline under Mean of Platt Singapore (MOPS).

The peso, he added, also depreciated by five centavos last month.

According to Concepcion, he would be meeting with representatives from transport sector, the Land Transportation Franchising Regulatory Board (LTFRB) chairman Elena Bautista and the oil companies to cushion the impact of the impending oil price hikes.

He said he would want to ensure that the transport sector can obtain diesel at wholesale prices to minimized and possibly avoid a transport fare hike.

Early this week, Caltex Philippines Inc. hinted that there would be more oil price increases in the coming days.

Aside from the impact of the CAA compliance, Caltex said there has been a steady increase in the price of crude in the world market.

"The spot market price of unleaded gasoline in the region has gone up by more than one peso per liter in December compared to the previous month’s price, while the spot price of diesel has also risen by about 50 centavos per liter over the same period," Caltex spokesman Jorge Marco said.

Marco noted that on a per barrel basis, in the case of gasoline, it had breached the $40 per barrel level in early December after trading at an average of about $36 per barrel in November. "This is the first time it had reached such a level since March" Marco said. "It is now trading at over $42 per barrel," he added.