WORLD OIL PRICES (January 18-22, 2016 trading days)

Extended crude price declines registered in the first four days as a global supply glut bumped up against bearish financial news that sparked deeper worries over demand. Dubai crude price dropped so far this year by 19 percent to US$23/bbl Thursday, the level last seen in April 2003. Similar extent of decline has been observed on benchmarks-Brent and WTI, falling-off last Wednesday to its bottom in twelve years of US$27/bbl.

Brent and WTI however rebounded back Thursday above $1/bbl on rallying financial markets, and recuperated further above US$30/bbl last Friday on expectations for boosted fuel demand behind the upcoming snowstorm in the U.S. Dubai crude followed through with more than US$2/bbl uptick by the end of the week. The prospect of new central-bank stimulus also supported the market as European Central Bank President Mario Draghi’s declared the necessity to review the Bank's monetary policy stance in March; thus, fueling hopes for more quantitative easing and ultimately greater energy demand.

Meanwhile, the International Energy Agency (IEA) warned that unseasonably warm weather and rising supply will keep the crude oil market oversupplied until at least late 2016, and could push the price below its current 12-year lows. "While the pace of stock-building eases in the second half of the year as supply from non-OPEC producers falls, unless something changes, the oil market could drown in over-supply” the IEA quoted.

Further, the Energy Information Administration stressed that U.S. crude inventories rose by 4 million barrels in the week ending January 15. The increase, reportedly the highest level since 1990, was greater than analysts' expectations of 2.8 million barrels. Refinery crude runs fell by 233,000 b/d while refinery utilization rates fell by 0.6 percentage points.

Gasoline stocks rose by 4.6 million barrels, compared with analysts' expectations in a Reuters poll for a 1.4 million barrels gain. It was contrary to distillate stockpiles that fell by 1.0 million barrels, versus expectations for a 133,000 barrels increase, the EIA noted.

For the Asian market, gasoline market fundamentals were seen stable as demand for prompt cargoes persisted. According to Platts, supplies for most loading periods remained ample, being balanced by fresh demand seen from Tanzania and Indonesia, the region's largest gasoline buyer. Import negotiations with these countries were said to be slightly larger than expected imports for first-half 2016.

For gasoil/diesel, sentiment in the Singapore gasoil market remained soft, with surplus supply weighing on prices.

Overall, week-on-week average Dubai dropped further by almost US$3/bbl. MOPS gasoline and diesel also decreased by nearly US$3 and US$4 per barrel respectively.

FOREX: The peso per dollar rate depreciated by P0.30 to P47.79, from P47.49 in previous week.

Other recommended reference site: https://www.aip.com.au/pricing

DOMESTIC OIL PRICES

Effective 26 January 2016, most of the oil companies implemented a price rollback for gasoline by P0.60/L, diesel by P0.90/L and kerosene by P1.10/L. These price movements are reflected in the table.

Total adjustment this year stands now at net decrease of P1.60/liter for gasoline and P3.20/liter for diesel.

* RON 95

For more information, call the

Department of Energy:
Pricing: 840-2187
LPG: 840-2130
Fuels: 840-5669
SMS: (0915) 4469421
Email: [email protected]
Website: https://www.doe.gov.ph