Double-digit fuel price hike looms

National

MOTORISTS may face another hefty increase in fuel prices next week, with gasoline and diesel prices in Metro Manila expected to exceed P100 per liter.

Department of Energy (DOE) Director Rino Abad said on Thursday, July 16, that pump prices could undergo an “extra-large” adjustment on July 21, with increases possibly surpassing P10 per liter, a report by Philstar said.

Based on the first three trading days, Jetti Petroleum president Leo Bellas projected diesel prices to increase from P9 to P10 per liter, while gasoline prices may rise from P3.50 to P4.50 per liter.

The estimates remain subject to change with two trading days still left.

“World oil prices have increased significantly this week due to the renewed hostilities in the Middle East, rekindling supply concerns as vessel traffic in the Strait of Hormuz declined significantly,” Bellas said in the report.

This week, diesel prices increased by P2.62 to P4.62 per liter, while gasoline prices rose by P1 per liter.

Gasoline currently sells for as much as P96.10 per liter in Metro Manila, while premium diesel is priced as high as P90.77 per liter.

“The renewed conflict in the Middle East has increased concerns over potential supply disruptions, which is pushing global oil prices higher,” Top Line Business Development Corp. senior vice president and COO Brigitte Carmel Lim said.

Lim said local pump prices are expected to continue increasing in the coming weeks if the upward trend in global oil prices persists.

She added: “For now, we are closely monitoring the market and remain hopeful that geopolitical risks ease to help stabilize oil prices.”

Land Transportation Franchising and Regulatory Board (LTFRB) chairman Vigor Mendoza II said he supports recommending a fare increase, noting that the impact on commuters would be “minimal” following the recent minimum wage adjustment.

He said regulators may consider approving fare hike petitions once fuel prices exceed P70 per liter.

“So we’re reviewing the impact of a fare increase to that decision or a subsidy can be given,” Mendoza told dzMM.

“Our recommendation really would be to bite the bullet and increase fares.”

The government is currently providing a P10 fuel subsidy for jeepney and utility vehicle drivers, costing about P160 million each month.

Mendoza said expanding the subsidy to cover all public utility vehicles would require around P2.4 billion in government funds every month.(Mary Elaine Virtucio, UP Cebu Comm Intern)