Strong peso helped keep oil prices from rising too much
MANILA, Philippines - The price hike for petroleum products this week could have been bigger had it not been for a strong peso against the US dollar.
Department of Energy director Zenaida Monsada said fuel prices in the international market really shot up considerably as many refiners are on a maintenance shutdown now that the winter season is winding up.
According to Monsada, the increases announced and implemented by oil companies are justified and corresponded with their own computation.
Oil companies on Tuesday raised the price of premium gasoline by P1.05 per liter. The price of regular gasoline went up by P0.75 per liter and diesel and kerosene by P0.45 per liter.
But Monsada clarifies that the increase is just on the fuel component and does not include biofuels - meaning biodiesel and ethanol.
Monsada says the increase for this component can be averaged by month's end before it can be reflected at the pump.
Meanwhile, Monsada says ethanol supply has eased a bit after the DOE expressed concern about an impending shortage due to tightness of imports.
The country only produces around 18% of the total ethanol demand to comply with the mandated 10% bioethanol blend. The rest is imported from other Asian or US markets.
According to Monsada, the government no longer needs to suspend the mandatory bioethanol blend on all unleaded premium gasoline as a result of the supposed shortage. Only regular gasoline is allowed to be in pure fossil fuel while the rest of the gasoline products should have E-10 based on the biofuels law.