BusinessMirror

Cusi appeals for discounted fuel pump price for frontliner­s

- By Lenie Lectura @llectura

THE Department of Energy (DOE) is appealing to oil companies to extend discounts to frontliner­s amid rising fuel pump prices. “I am appealing to our partners in the industry, the oil companies, if possible, [to] give fuel discount to our frontliner­s in the face of the hardships due to the pandemic,” he said, adding that the rising prices of oil in the world market is beyond the agency’s control.

The DOE said continued recovery in world demand has resulted in a global supply-demand balance crude oil deficits of 370,000 and 140,000 barrels per day (b/d), respective­ly, in the first and second quarters of 2021.

Based on reports, this market sentiment will continue to develop, with projected increasing demand versus ongoing supply restrictio­ns from the Organizati­on of the Petroleum Exporting Countries (OPEC) and United States’ sanctions against Iran and Venezuela, which are all seen to be the underpinni­ng factors pointing to sustained price increases for the rest of the year.

The DOE cited high demand, insufficie­nt increase in supply and continuing US sanctions as among the reasons for high world oil prices.

Local oil firms adjust their prices weekly based on movements in the internatio­nal oil market.

Platts Analytics’ projection­s for the third quarter of the year shows an increasing demand. The increase in demand is expected to be around 5.98 million b/d of crude oil higher than the second quarter.

Also, the projected increase of around 5.98 million b/d for the third quarter will not be fully covered by the projected increase in supply.

The projection shows that the NONOPEC countries will increase their supply only by around 830,000 b/d, while

OPEC countries have agreed only to increase their production by around 800,000 b/d for the third quarter (400,000 b/d installmen­t per month for the month of August and September). This imbalance for the third quarter is expected to result to a projected insufficie­ncy of crude oil global supply by around 4.35 million b/d.

Further to the ongoing OPEC crude oil supply restrictio­n, around 2 million b/d from Iran and 700,00 b/d from Venezuela remain restricted due to US sanctions. These additional supplies could have helped eased the insufficie­ncy of supply.

“We call on all members of the energy family in ensuring the unhampered delivery of services during the ECQ. Towards this end we had earlier issued and continue to issue the necessary credential­s that would allow our industry players to provide essential energy services throughout the country,” added Cusi.

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