MANILA, Philippines - Several oil companies would reduce the price of diesel products by P1 per liter effective today.
Petron Corp., Pilipinas Shell Petroleum Corp., Seaoil Philippines and PTT Phils. said the move was meant to reflect international crude prices in the local market.
Mean of Platts Singapore (MOPS), the benchmark being used by oil importers, dropped to $54 per barrel as of Feb. 17 from January average of $60 per liter.
Before the price rollback, diesel pump prices in the local market range from P23.24 per liter to P29.45 per liter.
Shell country chairman Edgar Chua earlier clarified that they use the MOPS as the basis for local pricing.
“Even if Shell has a refinery, current pricing is based on import parity, i.e., MOPS-based in the Philippine case. Refinery performance is benchmarked internationally, and refineries must be able to sell its products competitively, based on the alternative which is imported finished products,” Chua said.
He said oil pricing is driven primarily by fundamentals of international product costs and foreign exchange.
But he noted that since the oil industry is deregulated, the ultimate determinant of oil pricing is market competition.
Meanwhile, Consumer & Oil Price Watch (COPW) chairman Raul Concepcion said he expects more oil price rollbacks next month.
“COPW will accept that pump prices went up because the oil refiners used MOPS, as they had to import finished products – diesel, gasoline, auto-gas, when they shutdown their refinery for maintenance in December and January,” he said.
COPW also urged the DOE and DOJ to ask oil refiners-Shell and Petron and multinational importers Chevron Philippines and Total Philippines who control 80 percent of the market to explain if they bought forward for March delivery at $33.98 NYMEX on Feb. 12 and $37.51 for April delivery.