WORLD OIL PRICES  (May 4-8, 2015 trading days) 

The week’s trading started with oil prices hitting a 2015 high Monday. Brent crude, Europe’s benchmark, rose to $67 a barrel, and Asian benchmark Dubai to $64/bbl. The upside continues into the week, supported by the following:

• Expected slowdown in U.S. oil drilling. There are expectations that higher-cost crude producers such as the United States will cut oversupply. A number of of active U.S. rigs has reportedly fallen for a record 21 straight weeks to just over 900 rigs -- the lowest level since September 2010.

• Weak Chinese factory activity. Reuters reported that activity at China’s factories shrank at its fastest pace for a year in April as new orders fell.
• Yemen situation. An Arab coalition led by Saudi Arabia continues to displace rebels from the region. Despite Yemen not being among the major oil producers, investors are concerned that the fighting could affect shipping in the Bab-el-Mandeb strait of the Red Sea through which Saudi Arabia transports some of its exports.
• Fears of supply disruptions from Libya. This comes after a key port in the North African nation was shut down. Protesters forced the closure of the oil port of Zueitina, further cutting into already dwindling supplies from Libya.

By Thursday and Friday however, oil prices plummeted due to persistent oversupply concerns, and after the U.S. jobs report signaled weaker-than-expected economic growth.

Similarly in Asia, Platts reported that Asian gasoline market turned cautious by the end of the week following the release in the latest inventory data from US Energy Information Administration (US-EIA), which showed that US gasoline stocks rose 401,000 barrels last week vs. the analysts’ estimate of a 250,000-barrel decline. This suggests that fewer or no Asian gasoline may head west in the near term, Platts noted.

Meanwhile, Asian gasoil market started the month on stronger note due to falling inventory levels of middle distillates in Singapore. The emergence of prompt spot demand from Saudi Arabia also supported the gasoil market. Aramco Trading was said to have been seeking a total 1.7 million barrels of 500 ppm sulfur gasoil for delivery into Jizan (four cargoes of 300,000 barrels each) and Ras Tanura (500,000 barrel) in May, reportedly for stockpile ahead of summer.

Overall, Dubai crude price increased week-on-week by about US$3/bbl. Likewise, MOPS gasoline and diesel correspondingly increased by a little over a dollar and US$3/bbl.

FOREX:   Peso per US dollar rate depreciated by P0.31 to P44.63, from P44.32 in previous week.  

Other recommended reference sites:  (1) http://www.aip.com.au/pricing (2) http://www.med.govt.nz/ers/oil_pet/prices/prices.html 

DOMESTIC OIL PRICES

Effective 12 May, most of the oil companies increased their prices of gasoline by P0.50/liter, diesel by P1.10/liter and kerosene by P1.25/liter.

Year-to-date total adjustments now stand at net increase of P4.12 for gasoline and P1.86 for diesel, while LPG has a net decrease of P4.60/kg.

* RON 95

For more information, call the

Department of Energy:
Pricing: 840-2187
LPG: 840-2130
Fuels: 840-5669
SMS: (0915) 4469421
Email:  oilmonitor@doe.gov.ph
Website: http://www.doe.gov.ph