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DoE assures more price adjustments for January
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Jan 5, 2009 - 8:18:33 AM

By Marie S. Neri

MANILA, Jan. 6 (PNA) — Consumers can still expect further adjustments in the prices of petroleum products this month, the Department of Energy said Monday.

Energy Secretary Angelo Reyes said that while the Dubai crude increased to US$ 60 per barrel last January 2, this will still keep prices of petroleum products lower for until the end of this month.

”On the Philippine side, we anticipate that this year, 2009, the conventional wisdom is that prices will hover between US$ 40 per barrel to US$ 60 barrel. Right now, it is within the vicinity of US$ 40 per barrel,” Reyes said.

Reyes said the average for December was pegged at US$ 40 per barrel still lower against the November of about US$ 50 per barrel.

“So, for January, because of the low monthly average for December which is our reckoning point, we could reasonably anticipate more reduction in oil prices, and that would be diesel, gas and kerosene,” Reyes assured.

However, he declined to make projections if the price adjustments would still continue next month.

According to Reyes, the fact that there are some problems affecting the countries in the Middle East, it would be hard to assume that the low prices would be maintained.

“I don’t think we can reasonably expect people to project beyond one month because we are using the previous month’s average and the volatility of the situation in the Middle East ….add to that what’s happening in Nigeria where the pipeline was attacked…and what’s happening in Russia and Ukraine,” Reyes explained.

”It’s difficult to say that no event in the Middle East will influence prices….if you have a major outbreak of hostilities there that goes out of control….it’s anybody’s guess,” Reyes further said.

Aside from the ongoing hostilities, Reyes said the OPEC decision to reduce production by 2.2 million barrels is another factor that may cause prices of crude to move either upward or downward.

But he assured that rollback will be implemented this month.

“We should expect some more [rollbacks] because as I have said the prices of Dubai crude reached an average of US$ 40 per barrel and that is what we’re looking at for the pricing in January……we’re talking about the whole month of January…so the whole month of January, we should see some more movements downwards…reasonable ones,” he said.

Before Christmas, independent oil companies slashed the prices of their petroleum products by P1 per liter while Unioil Petroleum implemented a big time rollback of P4 per liter for diesel and P7 per liter for gasoline.

Prices of diesel now range between P30 to P34 per liter while gasoline stands at P32 to P34 per liter. (PNA)