WORLD OIL PRICES (May 5-9, 2014 trading days)

Following are the reasons for the declines in crude prices during the first four trading days:

• Subdued oil imports by China reflecting the country’s slow economic growth;
• Pro-Russian insurgents in Eastern Ukraine’s move to go ahead with a referendum on autonomy this coming weekend;
• Libya's efforts to increase oil exports kept prices from falling further; Libya's exports dropped to less than 300,000 b/d compared with around 1.4 mil barrels a year ago.

However, the market is balanced by the US DOE report disclosing a decrease in the country’s crude reserves. Said reserves sank by 1.8 mil bbl in the week ending May 2, confounding market expectations for a gain of 1.2 million barrels. The fall in US crude reserves indicates resurgent demand in the world's top crude consumer ahead of the busy summer holiday driving season.

Particularly for the prices of products in Asia, Platts noted that ample supply continued to exert downward pressure on Asian gasoline amid lack of fresh demand. A boost in demand for stockpiling ahead of Ramadan was expected but then Asia's largest importer, Indonesia, requested to defer its May-delivery cargoes to June. Rising inventory levels in the region and weaker US market added to the bearish sentiment.

On the other hand, activity in the Asian gasoil/diesel spot market was seen gaining momentum last Friday as requirements for fresh May cargoes emerged from the key Indonesian market. The slight strength in fundamentals pushed cash differentials for 500 ppm sulfur gasoil cargoes loading from the main trading hub of Singapore to a premium of 43 cents/bbl compared to a month ago on April 2, when premiums were at 27 cents/bbl. Platts added that tighter regional supply due to the ongoing scheduled turnaround season at several refineries in the second quarter will indefinitely help sustain sentiment in the gasoil market.

Overall, Dubai crude decreased further this week by about a dollar to US$104/bbl. MOPS gasoline and diesel decreased as well by almost US$2.30 and US$1.00 to about US$115/bbl and US$122/bbl, respectively.

FOREX: Week-on-week value of Peso appreciated against the US dollar by P 0.31 to P44.21 from P44.52, in the preceding week.

Other recommended reference sites:
(1) https://www.aip.com.au/pricing (2) https://www.med.govt.nz/ers/oil_pet/prices/prices.html

DOMESTIC OIL PRICES

Effective 13 May 2014, most of the oil companies implemented rollbacks in the prices of gasoline and on diesel by P0.85/liter andP0.55/liter, respectively.

Gasoline and diesel now have a year-to-date net decrease of P0.75/liter andP1.15/liter, 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