WORLD OIL PRICES (July 11-15, 2016 trading days)

Oil prices initially dropped on the start of the week on worries about global oil supply and stronger US dollars. Additional factors that contributes to the price fall is the rising of U.S oil drilling rig counts and bullish hedge on crude to four- months lows.

The price of crude oil however rose again by more than two dollars on Tuesday, July 12, behind reports of weakening U.S. dollar and the bullish OPEC report. The report said that the total output from all 14 members rose 264,000 barrels to roughly 32.9 million barrels a day last month. Although it is above the average monthly demand of 31.9 million, OPEC expects demand for the cartel's oil to increase to 33 million barrels a day next year. The report also said that non-OPEC supply is projected to decline by 900,000 barrels to 56 million a day in 2016. Further, non-OPEC supply is projected to fall another 100,000 barrels to 55.9 million a day in 2017.

Additional fall of oil prices was again felt last Wednesday, July 13, by more than 4 percent after the US government stunned the market with a raft of bearish inventory data, which added to the concerns over a global glut of oil. The US inventory report put pressure on prices in a market already bearish after the International Energy Agency (IEA) warned about a global oil glut.

The U.S. Energy Information Administration (EIA) reported that supply levels stood at 526.6 million barrels, lower by 2.6% from 540.6 million roughly two months ago. This steep decline in inventory is largely due to the falling number of active oil rigs, which is down from 645 to 351 over the last 12 months.

Then again Thursday (July 14) which seems to be a seasaw of oil prices climbed again as weaker U.S. dollar improved investor sentiment, which made the dollar-denominated oil more attractive for holders of other currencies.

In Platts Friday news, industry sources said gasoline supply and demand fundamentals in the Asia Pacific are expected to look increasingly more balanced in the near term. Although spot supply is currently ample with China continuing to push out additional cargoes of gasoline, the expected fall in overall Asian production of the automotive fuel will temper the supply glut.

As for Asian gasoil, requirements continued to hamper due to heavy rains and a fishing ban in China, and the monsoons in India.

The overall bearish outlook exerted downward pressure on fresh spot trades, translating to lower prices.

Overall, Dubai crude decreased week-on-week by US$1.92/bbl. MOPS gasoline and diesel decreased as well by about US$2.36 and US$2.70 per barrel, respectively.

FOREX: The peso per US dollar rate appreciated by P0.19 to P47.16/US$ from P46.97 in previous week.

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

DOMESTIC OIL PRICES

Effective today, 19 July, the oil companies implemented a price reductions in gasoline by P0.55/liter and P0.75/liter in diesel and kerosene.

This brings year-to-date adjustments to net increases of P1.04/liter and P4.63/liter for gasoline and diesel, respectively.

* 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