OIL industry sources said on Friday that consumers can expect a big-time increase for gasoline and diesel prices for next week.
According to Jetti Petroleum, gasoline prices will go up by around P2.30 to P2.50 per liter, while diesel prices will have a possible increase of P2.50 to P2.70 per liter.
These estimates are based on the 4-day trading of Mean of Platts Singapore, the pricing basis of refined goods in Southeast Asia.
As per local oil company, the reason for the huge increases for next week are mostly due to developments in the Middle East, as many are expecting Israel to retaliate and target the oil infrastructures of Iran.
“Primarily, the significant spike in crude oil prices is due to fear of supply disruption should Israel’s retaliation target Iran’s oil infrastructure,” Jetti Petroleum said.
“There is also some tightening in supplies of diesel and gasoline in our region due to production cuts because of ongoing refinery maintenance and refinery run cuts, and unplanned refinery outages in Indonesia and Malaysia. Overall, prices may also stay elevated because of the said Middle East tension,” it added.
On Tuesday, the local oil companies implemented an increase of P1.20 per liter for diesel and P0.70 per liter for kerosene.
Meanwhile, there was no price movement for gasoline.
On a year-to-date basis, the total adjustment of diesel stands at a net increase of P4.05 per liter while gasoline remained at P6.40 per liter.
On the other hand, kerosene has a total net decrease of P5.35 per liter.
Electricity rates
Meanwhile, the Manila Electric Company (Meralco) has said that that electricity rates are lower by P0.3587 per kilowatt-hour (kWh) this October, bringing down the overall rate for a typical household to P11.4295 per kWh from September’s P11.7882 per kWh.
For residential customers consuming 200 kWh, they will see a decrease of around P72 in their total electricity bill this month.
According to Meralco, the decrease is mostly due to the P0.3059 per kWh reduction in the generation charge as a result of lower costs from the Wholesale Electricity Spot Market (WESM).
For the components of the generation charge for the month, WESM charges decreased by P5.1001 per kWh following the completion last month of the collection of deferred May 2024 costs ordered by the Energy Regulatory Commission (ERC) or the settlement of 30 percent of the amounts for payment for trading transactions made in the reserve market during the March 2024 billing month.
Also contributing to the reduction was the improved supply situation in the Luzon grid as both average demand and average capacity on outage went down by 544 megawatts (MW) and 519 MW, respectively.
Further, charges from Independent Power Producers (IPPs) increased by P1.8556 per kWh mainly because of the increases in charges from First Gas plants Sta. Rita and San Lorenzo as a result of the ERC’s approval of higher pass-through Malampaya fuel prices beginning this October 2024, under their new Gas Sale and Purchase Agreements (GSPAs) with the Malampaya consortium.
Meanwhile, charges from Power Supply Agreements (PSAs) inched up by P0.1128 per kWh.
WESM, IPPs, and PSAs accounted for 24 percent, 26 percent, and 50 percent, respectively, of Meralco’s total energy requirement for the month, and the decrease in WESM charges offset the increases in IPP charges for the same period.
Next, the transmission charge for October also went down by P0.0383 per kWh due to lower ancillary service charges, whole taxes and other charges similarly decreased by P0.0145 per kWh for the month.
Meralco said that pass-through charges for generation and transmission are paid to the power suppliers and the grid operator, respectively, while taxes, universal charges, and Feed-in Tariff Allowance (FIT-All) are all remitted to the government.
As for the distribution charge, Meralco said it has not moved since the P0.0360 per kWh reduction for a typical residential customer in August 2022.
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