Oil price cut in the offing this week‏

January 31, 2011 7:50 am 

MANILA, Jan. 30 — Oil consumers can heave a temporary relief as the Department of Energy expects oil companies to cut prices this week.

Energy Undersecretary Jay Layug told reporters that oil firms, namely Flying V and Pilipinas Shell Petroluem Corp. have indicated a possible price rollback this week due to the softening of world oil prices.

"In the international market, prices are going down because China announced that it will increase interest rates to hold inflation because they noticed that the economy has been going too fast and therefore, the demand for oil is going very high," Layug said.

The announcement of Saudi Arabia, one of the world's biggest oil producer, to increase production is also expected to help bring down oil prices.

"Shell told us Friday they will cut prices but no specific amount because they said that market is going down. I hope that would be good for the transport group," Layug said.

Pump prices went up by P1.75 per liter for gasoline and P2.25 per liter for diesel since January, prompting the transport sector to ask for higher fares.

Since the start of the year, international oil prices have sustained their upward movement.

Averaging 75 dollars per barrel at the end of 2009, Dubai crude prices have breached the 90-dollar per barrel mark in recent weeks –the highest in two years.

Layug said Flying V announced a possible price cut of P0.80 per liter for gasoline and P0.20 per liter for diesel this week and the other oil firms may also cut prices at almost the same level.

The energy official commended Shell and Petron for offering a P1 per liter fuel discount to the transport sector.

He said Chevron formerly Caltex is also "considering giving a P1 per liter fuel discount."

Petron on Friday announced that it will roll-out the Pinoy Diesel lanes in selected service stations in Metro Manila starting Saturday.

Petron followed Shell's announcement of a discount lane for the transport sector in Malacanang on Friday.

Petron said the move supports the national government’s call to cushion the impact of rising fuel prices to benefit the transport sector and the commuting public.

"We have always been concerned with our stakeholders especially the transport sector. The Petron Pinoy Diesel lanes underscore our commitment to find avenues to mitigate the impact of rising crude oil and finished product prices in the international market," Petron public affairs head Charmaine Canillas said.

"We would like to assure the transport sector that we are in the process of studying programs that will have a direct impact on their welfare," she said.

Petron pioneered the diesel discount concept back in March 2003 when it offered lower diesel prices at selected service stations to cushion the impact of rising prices. (PNA)

LDV/ASF/rsm

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