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MANILA: After months of languishing at rock bottom prices, a large hike went into effect at 12:01 am today reflecting an increase in the projected price of Brent and West Texas oil in the global market.
Caltex, Flying V, Petro Gazz, Phoenix, Seaoil and Shell have increased the price of diesel by Php 1.90 per liter and Php 2 per liter for gasoline.
Kerosene from Caltex, Flying V, Seaoil and Shell also rose today at Php 1.25 per liter.
In addition to an increase in the world oil price, the price increase is also the market reaction to the reduction in oil production that started on May 1, 2020, as agreed by members of the Organization of Countries Petroleum Exporters (OPEC), OPEC + and the United States.
Production has been drastically reduced by around 10 million barrels per day to stem excess oil supply and curb falling prices, and this will continue until June 2020.
By August, until the end of the year, oil production will decrease by 8 million barrels per day. In 2021, it will drop to 6 million barrels per day until April 2022.
The deal is subject to review in December 2021.
If the stocks of these fuels were removed from storage after the publication of this Executive Order by President Duterte, it will also incur an additional 10% import tariff for the government to finance the social improvement program.
Also read: Duterte to increase the tax on petroleum products by 10%; the price of gas goes up, diesel goes down
