By ARNOLD PADILLA
For the 22nd time this year, the price of diesel will again go up this week with oil firms announcing a price hike of PHP 0.60 per liter. Gasoline will also increase by PHP 1.15 per liter, the 23rd price hike this year. Similarly, the price of kerosene will go up for the 19th time, with an upward adjustment of PHP 0.65 per liter this week.
With these latest adjustments, the total price hike for diesel this year is now at PHP 10.60 per liter; for gasoline, PHP 13.50 per liter; and kerosene, PHP 9.00 per liter.
Due to automatic price adjustments under the Oil Deregulation Law, oil firms are able to hide price hikes that go beyond the changes in the global price benchmark that they supposedly base their local price adjustments on.
As of July 6 price adjustments, the price of diesel-based on movements in the Mean of Platts Singapore (MOPS) as well as the fluctuations in the US dollar and PH peso exchange rates (because oil products are imported) should have only increased by PHP 7.92 per liter. But the actual price hikes implemented by the oil companies reached PHP 10.00 per liter as of July 6 – or PHP 2.08 per liter higher than what is “allowed” based on movements in global prices and exchange rates.
MOPS is the international reference in determining adjustments in the pump price of petroleum products in the Philippines, according to the Department of Energy (DOE).
Similarly, during the same period, oil companies jacked up the pump price of gasoline by PHP 12.35 per liter when changes in MOPS prices and exchange rates only justify a price increase of PHP 9.99 per liter – or a difference of PHP 2.36 per liter.
These are updated estimates of an earlier post on oil overpricing: https://bit.ly/OilOverpricing