A cut in liquefied petroleum gas prices will be short-lived as rising world contract prices wipes out gains from the Philippine government’s suspension on excise taxes on kerosene and LPG.
LPG Marketers Association president Arnel Ty said Regasco is set to implement a P3 per kg or P33 per 11-kg tank cut in prices effective Wednesday, September 30, as a result of Executive Order 125, which suspends excise taxes on LPG and kerosene.
“Mas gusto kasi ng Department of Energy to reflect, para hindi magulo sa ating mga consumer, ‘yung effect ng suspension ng excise tax dahil ang suspension na ito ay ilang linggo na rin naman pinag-aralan ng Department of Finance,” he said in a DZMM interview.
However, he pointed out that world market prices of LPG are rising, which could lead to an increase in local LPG prices by October 3.
“As of today, ang nakikita namin it will be ranging from P10 to P15 per kg sa LPG,” he said.
President Ferdinand Marcos' announcement of a cut in LPG and kerosene excise taxes follows a threat by bus operators to hold a two-day nationwide transport strike this week to press the government to let them raise fares, which are state-regulated.
Fuel prices in the Philippines are unregulated, unlike neighbors including Indonesia, Malaysia and Thailand, leaving local transport firms to deal with market fluctuations.
Marcos said the tax would automatically revert after three months, or a week after the one-month average Dubai crude oil price falls below $80 per barrel.
In the interview, Ty noted LPG prices move only once a month unlike gasoline and diesel prices, which fluctuate weekly.
He said the effect on shipping costs and premiums after 2 months of Middle East tensions plus Saudi Aramco’s announcement of new contract prices by the end of the month will weigh heavily on local LPG prices.
Lack of a consensus between the US and Iran plus President Donald Trump’s announcement of the resumption of airstrikes after the midterm elections also led to an increase in world crude prices. With Agence France-Presse