THE large drop in local fuel prices expected next week may not be sustainable as the International Energy Agency (IEA) warned that the global oil supply would suffer a major cut once Russia’s petroleum stops reaching the market due to sanctions over its invasion of Ukraine.
For the first time this year, motorists can expect a rollback, and a hefty one, too, with diesel falling by as much as P11.70 and gasoline by P6.25 per liter based on calculations by local oil companies on Saturday. Kerosene, mainly used as cooking fuel, could drop by an average P8.75 per liter.
The rollback, almost equivalent to the same price rise last week, is expected to take effect on Tuesday.
These rates are based on last week’s trading in the world market and in keeping with weekly price adjustments in the deregulated downstream oil sector.
Other factors that affect prices at the pump are the premium charges on petroleum imports, foreign exchange rate fluctuations and the biofuel components added to diesel and gasoline.
The IEA on Friday projected an oil supply crunch of 3 million barrels a day of Russian oil.
Hopes that talks between Russia and Ukraine would result in a positive agreement evaporated quickly last week, sending oil prices back above the $100 per barrel.
The IEA is an autonomous intergovernmental organization and serves as an information source on the oil market and other energy sectors, which helps countries respond to disruptions in the global oil supply.
It proposed a 10-point plan to ease the expected supply strain and trim the high prices of petroleum products.
The plan includes “car-free Sundays in cities,” working from home up to three days a week, avoiding air travel and practicing an energy-efficient lifestyle.
It noted that “immediate actions in advanced economies can cut oil demand by 2.7 million barrels a day in the next four months.”
One move to aid public transportation in the country got under way last week with the release of P569 million worth of fuel subsidies to drivers of public utility vehicles (PUVs) from the state-owned Land Bank of the Philippines.
Beneficiaries without cash cards can get them from Landbank branches identified by the Land Transportation Franchising and Regulatory Board (LTFRB). The cards are to be used to purchase fuel from participating fuel stations nationwide. (©Philippine Daily Inquirer 2022/Karl R. Ocampo)
