Domestic fuel prices are projected to rise by as much as PHP10.50 per liter next week amid fresh military exchanges in the Middle East.
In a message to journalists Friday, Julu17, Jetti Energy president Leo Bellas said diesel prices will likely increase by PHP9.50 to PHP10.50 per liter and gasoline between PHP3.50 to PHP4.50 per liter, based on the price developments in the first four trading days this week.
Crude prices have been on the rise anew and Bellas said this was “mainly supported by an elevated geopolitical risk premium, which rebuilt after Iranian attacks on commercial ships attempting to transit the Strait of Hormuz outside the Iranian-approved route, and the retaliatory strikes by the US on Iranian military assets.”
“Worries of supply disruption, tightening product balances as vessel traffic in the Strait of Hormuz declined sharply, and the US naval blockade of ships to and from Iranian ports have pushed prices higher,” he said.
Bellas explained that prices of diesel and middle distillate has risen “sharply due to tightening fundamentals, driven by seasonal increase demand while near-term supply continues to tighten, along with renewed Middle East hostilities.”
Another factor is the lower “diesel exports from Russia, which have been significantly curtailed due to energy infrastructure damage caused by intensifying Ukrainian drone attacks.”
In terms of gasoline prices, the main contributor to its rise is the “escalation of tensions in the Middle East, which rose following renewed U.S.-Iran confrontation and threats around the Strait of Hormuz.”
“Concerns over the availability of crude feedstocks and refined products during the peak demand season due to uncertainty surrounding vessel traffic through the Strait of Hormuz, and instability around the vital waterway, are further supporting gasoline prices” he added.
For this week, DOE earlier said gasoline prices may rise or decrease by PHP1 per liter, diesel may be hiked by as much as PHP4.62 per liter, and kerosene to rise by as high as PHP4.22 per liter.*PNA
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