OIL  FIRMS  CUT  PRICES  ANEW  BY  P1/LITER

MANILA, SEPTEMBER 1, 2006
(STAR) By Donnabelle Gatdula - The country’s oil companies rolled back anew the prices of their gasoline products by P1 per liter yesterday.

Unlike the previous oil price reduction where only prices of gasoline products were rolled back by P1 per liter, the oil firms, this time, also brought down the price of their diesel products by 50 centavos per liter.

But the oil firms decided to keep the price of their liquefied petroleum gas (LPG) or cooking fuel at current levels.

The oil companies said they reduced their prices again to reflect in the domestic front the lowering of petroleum prices in the world market.

"Due to weakening of international oil prices, we rolled back our pump prices," Petron public affairs manager Virginia Ruivivar said.

As of Aug. 30, 2006, Dubai crude, benchmark being used by local oil refiners in pricing their products, averaged $68.93 per barrel as against July’s average of $69.17.

The softening of the Dubai crude came after three consecutive months of continuing rise from June’s average of $65.22 and May’s $65.

The gasoline price based on Mean of Platts Singapore (MOPS), the pricing gauge of oil importers, also softened to $81.61 per barrel as of Aug. 20 from July’s $85.50; $82.76 in June; May’s $86.80.

Diesel averaged $86.13 as of the latest pricing monitor of MOPS for the month of August lower than $87.37 in July and $87.57 in June.

For the month of August, the international contact price of LPG averaged $547 per metric ton, higher than $502 in July and $470 in June.

In another development, Filipino-owned Flying V and its affiliate companies yesterday said it would provide free food and gas as a form of logistics support to Guimaras oil spill cleanup operations.

Flying V spokesman Macky Lopez said officials from the oil company, Filoil and Filpride Energy Corp., met with Iloilo Gov. Neil Tupas and made known its commitment to help the PCG and ensure that the oil spill will not reach the shores of Iloilo City.

"We will provide logistics support to the Coast Guard such as food and gas to ensure that they will be able to perform well their duties during the cleanup operation," he said.

Currently, the oil spill has already reached the towns of Concepcion and Ajuy in Iloilo, thus posing a big threat to the fishing industry in the province.

Iloilo has been known to be the main fishing grounds of the entire Panay Island.

Lopez said Tupas, together with other local government officials of Iloilo City were appreciative of the efforts of the Flying V group. Flying V, which has 125 stations nationwide, has four gasoline stations in Iloilo City.

Flying V, as a concerned Filipino oil company, wants to do what it can to help contain the oil spill, which has threatened the livelihood and affected thousands of lives in Guimaras province, Lopez added.

Flying V wants to protect Iloilo City from being contaminated by the oil spill as many other groups are already focusing their efforts on the cleanup in Guimaras, he said.

Major independent Flying V, together with Filoil and Filpride are all members of the Independent Philippine Petroleum Companies Association (IPPCA), which has also launched efforts to help in the containment of the oil spill.

But power rates up

Meanwhile, the country’s electricity rates, including in Manila Electric Co. (Meralco) franchise area, will slightly increase this month, the Philippine Electricity Market Corp. (PEMC) top official said.

PEMC president Lasse Holopainen told reporters that there was a slight increase in prices of power traded via the Wholesale Electricity Spot Market (WESM) for the period July 26-Aug. 25 which will be reflected in the electric bills of consumers this month. PEMC is the operator of WESM.

Holopainen noted that there was a 10-centavo per kwh jump in the load weighted average price (LWAP) in the spot market to P2.90 per kWh from last billing month’s P2.80 per kwh.

He traced the rise in LWAP to the forced outage of one unit of the 1,200-megawatt Sual coal-fired power facility last Aug. 7, effectively taking out 600 MW.

Sual will be down for eight months or until April 2007. "The discount that consumers can enjoy will be lower because the Sual power plant is out," Holopainen said.

Meralco residential general service customers got a 79- centavo per kwh savings in their monthly power billing in August this year due to cheaper power purchased from the spot market.

The PEMC chief also considered the lower utilization of hydro plants due to less rain occurring in the past days as one of the factors in the lower discount to be enjoyed by electricity consumers.

Holopainen explained that since Meralco is procuring almost 50-percent of its power supply from the WESM, the impact on its rate could be an increase of five centavos per kwh.

But he said Meralco rates might remain steady, depending on the final estimate that would come out of its blended rate. According to Holopainen, despite the slight increase, he is optimistic that supply would be sustainable vis-ŕ-vis demand in the next three months.

He warned though that supply problem may start to occur during the high-demand season of December and in the summer months next year.

"I expect the demand to continue over the next few months until peaking somewhere around December and because of that, the drop in prices will start creeping back up," Holopainen said.


Chief News Editor: Sol Jose Vanzi

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