From five-week streak of increases, fuel prices ease off this week at the pumps, providing some measure of relief to a population still reeling from the effects of a weaker peso.
It's a slightly good week for motorists, with rollbacks on diesel and kerosene and no price movements for gasoline
In separate advisories, oil companies said they will slash prices of diesel fuel by as much as Php 3 per liter. Kerosene prices will also roll back by Php 3.40 per liter. No price adjustments were implemented for gasoline.
According to the Department of Energy (DOE), there has been a general increase in fuel prices as of June 28 since the start of the year. Gasoline became more expensive by Php 30 per liter, diesel by Php 45.90, and kerosene by Php 39.75.
The agency’s Oil Industry Management Bureau said that the latest price reductions are an effect of various interest rate hikes globally, as central banks in both developed and emerging economies prepare to battle inflation. Rate hikes in the U.S. led to the strengthening of the dollar against all other currencies including the Philippine peso, resulting in higher fuel prices in recent weeks.
The strengthening of the U.S. dollar contributed to recent oil price increases
One major factor has been reduced demand in China, which has been placed under new lockdowns over fresh cases of COVID-19 reported this month. Anhui province, where more than 1.7 million residents live in the eastern part of the country, reported almost 300 new cases Monday.
This was followed by Wuxi province, a manufacturing hub where 31 new cases were found. China’s largest urban center, Shanghai, also logged three new COVID-19 cases. All in all, mainland China tallied 473 additional cases as of July 2. No deaths have been reported so far, but the figures are a challenge to China’s stringent zero-COVID policy.
China's rebound and expected demand for oil will have to take a back seat in the meantime
The rise in cases cut short the Middle Kingdom’s momentum just as it was emerging from previous lockdowns implemented in Shanghai. The lifting of restrictions in China was widely anticipated to increase the global demand for oil, as the country of 1.45 billion looked to restarting its economy.
Keep tabs on local fuel prices at Philkotse.com.