Big fuel price rollback set for June 2

MANILA, Philippines – Motorists will see some relief as big rollbacks in pump prices are set to take effect on Tuesday, June 2, the Department of Energy (DOE) announced.

Speaking at a press conference on Monday, June 1, Energy Secretary Sharon Garin announced the following pump price adjustments:

• Diesel – Rollback of at least P9.26 per liter
• Gasoline – Rollback of at least P4.76 per liter
• Kerosene – Rollback of at least P10.86 per liter

The rollback comes after local pump prices increased the previous week amid tightening fuel inventories across the globe. Last week’s price hikes placed retail prices of diesel in Metro Manila at around P82.70 per liter, gasoline at P82.90 per liter, and kerosene at around P113.80 per liter.

Despite the rollbacks of other liquid fuels, however, the price of liquefied petroleum gas (LPG) will rise by around P3.41 per kilogram.

Garin said the rollback is a good sign as this brings fuel prices closer to amounts before the Middle East crisis.

According to the DOE’s oil price monitor dated May 26, global prices of gasoline increased while diesel prices in the world market decreased by around $0.30 per barrel.

While diesel prices in Asia softened due to easing tensions in the Middle East over progress in negotiations between the United States and Iran, weaker demand is expected to keep prices under pressure.

“Asian gasoline prices remained firm, supported by tight supply conditions. Key drivers include low US inventories heading into summer driving season, limited Chinese exports and steady regional demand,” the DOE wrote.

Fresh LPG delivery

The DOE also reported the government’s procurement of around 21,000 metric tons of LPG sourced from the US to bolster the country’s supply of the liquid fuel. Half of the shipment is refrigerated propane while the other half is refrigerated butane.

The cargo – equivalent to four days of LPG supply for the country – arrived in Batangas on Saturday, May 30.

“Nakabili po ang bansa ng LPG stock kasi at a certain point mahirap maghanap pero ngayon po dumating na po yung order natin. At sufficient po para hindi po ma worry po ang restaurants natin, mga manufacturing natin, pati ang mga bahay po, households na gumagamit ang LPG,” Garin said.

(Our country managed to purchase LPG stock, because at a certain point it was hard to source, but our order finally arrived and we have an efficient supply so restaurants, manufacturing sector, and even households that use LPG will no longer worry.)

Garin earlier pointed out that the country’s LPG supply was rather low and said that the energy department was in talks with LPG firms to consolidate orders.

With the fresh LPG shipment, the country’s inventory of LPG can now last up to 42.13 days. The country’s overall fuel inventory (average for all fuel types) can last up to 45.97 days as of Monday, June 1.

Diesel supply can last up to 44.36 days, gasoline supply is good for 47.10 days, while kerosene inventories can supply the country’s demand for 143.64 days.

To further protect the country from future oil shocks, Garin said that the government is working to establish its own petroleum reserve and develop new stockpiling facilities. The country’s energy chief also noted that Japan agreed to support this initiative during President Ferdinand Marcos Jr’s state visit to Tokyo.

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“It means we will have reserves in the country, additional reserves, not only on the private or the additional stockpiling that is being done by the PNOC. This would be a more systematic and a more organized system,” Garin explained.

Garin also said that the DOE met with the Maharlika Investment Corporation and the Philippine National Oil Corporation to create the national reserve. While it is too early to name a total cost for the project, Garin said that preliminary evaluations place the cost at around P5 billion per tank, which can store around 500,000 to 1 million barrels.

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– Rappler.com