Last week, we’ve seen perhaps the biggest fuel price hike in the last couple of years as fuel companies adjusted the price per liter of gasoline and diesel by PHP 3.60 and PHP 5.85, respectively.

But, that was nothing compared to today's PHP 7.10/ PHP 13.15 price hike on gasoline and diesel, and pump prices are now between PHP 75.00 to PHP 80.00 (regular unleaded), while diesel fuel (regular) prices range between PHP 74.00 to PHP 80.00 in Metro Manila. 

Unfortunately for the millions of motorcycle riders, as well as drivers of other types of vehicles, gasoline and diesel prices will be going up again in the coming weeks.

P7 gas, P13 diesel fuel price hike announced by Caltex, Cleanfuel image

Gasoline and diesel prices can retail as high as PHP 100.00

The Department of Energy (DOE), has recently released what could be the fuel prices, should the price of imported oil hit the USD 140.00/ barrel mark.

According to the energy department, should the price of imported oil hit USD 140/barrel, expect the price of gasoline to hit PHP 87.00/ liter, while the price of diesel could be as high as PHP 81.00. However, with today's fuel price hike, the pump price of gasoline and diesel had already breached PHP 80.00 per liter barrier and soon, may even reach PHP 100.00 per liter if oil prices go up even further

Now, since most of our groceries, and other goods are transported by vehicles that consume gasoline or diesel fuel, expect the cost of these to also go up within the next few days or weeks.

Saudi and UAE

There are factors that affect the price of oil in the international market, and the Organization of Petroleum Exporting Countries (OPEC), particularly, Saudi and UAE, could help in lowering fuel prices at the consumer level.

In a nutshell, due to the conflict in Eastern Europe, the world’s oil supply is a bit short due to embargoes placed on Russian crude oil. Russia is the second-largest oil exporter in the world, after Saudi Arabia.

To ease up on fuel prices, Saudi and UAE – both OPEC member countries, are two of the few countries in the world that can draw from their Spare Capacity, according to a report from Reuters, to increase oil exports, helping to offset supply losses from Russia.

According to the International Energy Agency (IEA), Saudi and UAE hold about 1.8 million barrels per day (BPD) of “short order” spare capacity, which is equal to almost 2% of world demand and almost all the total 2.2 million BPD of such capacity available.

Although if OPEC countries would tap into their spare capacity of crude oil or about 4 million BPD, it is still short compared to the 7 million BPD of crude oil that is exported by Russia, equivalent to about 7% of the world’s supply.

Let’s just hope that Ukraine and Russia could settle their differences peacefully and help economies like ours bounce back from the effects of the global pandemic.