WORLD OIL PRICES (February 19-23, 2018 trading days)
Dubai crude increased week-on-week by about US$1.60 a barrel. MOPS gasoline and diesel increased as well by nearly US$1.40 and US$2.00 per barrel.
Reasons for the Adjustment
Oil prices hit their highest level in nearly two weeks Monday, aided by a recovery in the global equity market and tensions in the Middle East, tempered by growing U.S. production.
- European shares rose for a fourth straight session, with global stocks set for a sixth session of gains, following a sell - off triggered by fears of creeping inflation and higher borrowing costs, Reuters reported.
- Crude inventories had been forecast to rise 1.8 million barrels, as stocks seasonally increase when refineries cut intake to conduct maintenance.
- A strengthening dollar, which hit a six - day high, however, counterbalanced on oil prices. A more robust dollar makes oil and other dollar - denominated commodities more expensive for holders of other currencies, thus result ing to lower demand and prices.
- After the increases in the Monday and Tuesday trading, oil prices fell on Wednesday, weighed down by a rebound in the US dollar from three - year lows last week, and by an expected rise in US crude production. US West Texas Intermediate (WTI) crude futures were down 60 cents, and Brent crude by 48 cents, from their respective last settlements. However, the effect on the local market remains high as Philippine Peso remains depreciated.
- Oil prices surged again on Friday after the shutdown of a key oilfield in Libya. Crude rebounded from an early loss after reports of the shutdown of the El Feel oilfield in Libya, which produces 70,000 bpd. Production in this OPEC member country has been running at about 1 mbpd, although it remains volatile due to unrest in the country.
- Oil is also boosted by upbeat comments from Saudi Arabia that an OPEC - led effort to erode stockpiles through output curbs is “working”. In the latest OPEC comment that a supply cut deal led by th e OPEC and by NON - OPEC members is working, Saudi Arabia's Energy minister said that he expected inventories to keep declining this year: "The oil markets, it's clear, are rebalancing. Many agencies have documented the decline in inventories and I think tha t'll continue in 2018".
FOREX: The value of Philippine peso per US dollar depreciated by P0.25 to P52.14, from P51.90 in previous week.
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DOMESTIC OIL PRICES
Effective 27 February 2018, most of the oil companies implemented a n in crease in gasoline by P0.65/liter, diesel by P0.85/liter and kerosene by P1.15/liter.
Y ear-to-date, total adjustments are currently at a net increase of P 0.90/liter for gasoline, P1.40/liter for diesel and P2.30/liter for kerosene.
As monitored, shown below are the retail prices in Metro Manila beginning February 27, 2018.
* RON 95
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