Domestic fuel prices are projected to decline by as much as PHP4 per liter on Tuesday, Sept 1. , after a big jump this week, as market expectations for the risks from the US-Iran conflict eased.
Citing price developments in the international market as of Thursday, Jetti Petroleum president Leo Bellas said diesel prices will likely go down between PHP3.50 and PHP4 per liter and gasoline between P0.25 and PHP0.75 per liter.
In a message to the media Friday, Bellas said fuel prices went down this week “as threatened US sanctions fell short of the market’s expectations and (investors) viewed the economic pressure as a lower-risk path for physical supply than a military escalation, reducing the oil market’s anxiety and easing immediate supply concerns.”
He also noted that “prices are further weighed down by signals of a potential return to mediation to end the war and reopen the Strait of Hormuz after Iran said it had resumed talks with Oman, although the physical supply picture reflects a still-constrained market and supply disruption risks remain.”
Another factor that boosted supply and address risks was the rising refined products outflows from China due to renewed refined product export allowances, including incremental flows from the US and India, Bellas said.
“However, with the recent rebound in world oil prices following latest reports that the US is not interested in returning to the ceasefire deal terms with Iran, the potential rollback on local pump prices next week could be capped, with risk of pushing to the lower limits of the initial estimated range,” Bellas said.*PNA
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