Concepcion sees hefty price increases for diesel, gasoline

Industrialist Raul T. Concepcion said yesterday oil refiners Petron Corp. and Pilipinas Shell Petroleum Corp. would likely increase their prices by P2.24 per liter for diesel and P1.45 per liter for gasoline. 

Concepcion, chairman of the Consumer and Oil Price Watch (COPW), said their computations were based after deducting the 50-centavo per liter increase implemented by the oil refiners last April 3.

Based on COPW data, Shell and Petron’s over-recovery amounted to P1.36 for diesel and 89 centavos for gasoline since they based their increase on 100-percent MOPS (Mean of Platts Singapore) when it should only be based on 70-percent Dubai crude and 30-percent MOPS for blending. 

Concepcion said if only the oil majors will accept his computation, the oil price hikes due them should have been lower.

"Therefore, the net increase due in April is 88 centavos for diesel and 56 centavos for gasoline on the assumption that Shell and Petron will accept the reason for the over-recovery which is the reason why the COPW filed a complaint under Section 14(d) of the Oil Industry Deregulation Law," he said.

But for importers like Caltex Philippines Inc., Total Philippines Inc. and the new players using 100-percent MOPS, the net increase in April is P1.64 for diesel and 86 centavos for gasoline.

Concepcion said Dubai crude pegged at $50.30 per barrel last April 4 compared to the March average of $45.84 or an increase of 10 percent. 

The consumer advocate has warned that prices will continue to exhibit volatility in the next few weeks. "The prices in the oil market are very volatile and we will closely monitor the trend weekly," he said.

Concepcion said with the escalating prices, he will meet with Energy Secretary Raphael Lotilla and Justice Secretary Raul Gonzales  to validate their oil price computations and inform the public on the actual price increase due for the month of April.

"This becomes urgent as the consuming public will want to find out the reason for the price increase in the light of escalating world prices," Concepcion said. 

Last week, a number of small oil firms raised their prices by another 50 centavos per liter.  It is expected that the oil companies will be implementing 50 centavos per liter price increases in the next few weeks until their recoup their under-recoveries.