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Inq7.net: Oil prices seen going up further

Inq7.net: Oil prices seen going up further

“Soaring prices in the international market could be attributed to the continued threat of terrorist attacks on oil installations in the Middle East, particularly in Iraq, and the high demand for fuel in the United States brought by the summer driving season.”

Abigail L. Ho

Inquirer News Service

Posted 1 August 04

PUMP prices of petroleum products can still go up in the next several weeks, with or without an increase in import tariffs or excise taxes.

The Independent Philippine Petroleum Companies Association — which groups “new players” in the industry dominated by the Big Three companies Petron Corp., Pilipinas Shell Petroleum Corp. and Caltex Philippines Inc. — said the new players, which are all importers of finished products, still had to recover costs of 0.78 peso a liter for unleaded gasoline and as much as 3.81 pesos a liter for diesel. As this was the case, pump prices had nowhere to go but up, the group said.

An Inquirer source in the industry said oil companies could raise prices in the next few weeks as prices of crude and refined petroleum products in the world market had lately been going up.

Unleaded gasoline, based on the Mean of Platts Singapore (MOPS) benchmark for finished products, were trading in the past few days at an average of around $47.50 a barrel versus a June average of $45.19 a barrel, the source said.

The price of MOPS-based diesel has risen by almost $6 a barrel this month, from $42.84 a barrel in June to $49 a barrel in recent days.

The July 1-28 averages for MOPS-based unleaded gasoline and diesel were $46.24 and $45.98 a barrel, respectively.

The benchmark Dubai crude, which local refiners use in determining their pump prices, also reached a July 1-28 average of $34.54 a barrel from a June average of $33.43.

“Local pump prices have not kept in step with price movements in the regional spot market,” the source said. “This is due to continued social pressures in the local environment.”

Soaring prices in the international market could be attributed to the continued threat of terrorist attacks on oil installations in the Middle East, particularly in Iraq, and the high demand for fuel in the United States brought by the summer driving season.

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