CPP denounces oil price increases, unsubstantial rollback amid steep fall in crude oil prices

Information Bureau
Communist Party of the Philippines
December 31, 2014

The Communist Party of the Philippines (CPP) denounced the big oil companies for raising anew the prices of local petroleum products and their failure to roll back prices substantially to reflect the large drop in the international prices of crude oil.

Yesterday, big oil companies increased gasoline prices by P0.30 per liter and kerosene by P0.10.
Chart of rate of change of prices of gasoline, diesel and Dubai crude

The CPP pointed out that prices of Dubai crude have dropped by as much as 50.81% since June (from $108.01 to $53.13 per barrel). Compared to the rate of reduction of Dubai crude prices, the reduction in local prices of diesel has been slow at mere 30.76% since June (from an average of P45.35 to P31.40 per liter). Local prices of gasoline have been reduced at an even slower rate--23.98% since June, from an average of P55.35 to P42 per liter.

"The sluggish reduction in the prices of local petroleum products reflects the fact that local oil prices are not primarily reflective of movements in the prices of crude oil, but by the oil companies' drive to maximize their profit rates to the detriment of the Filipino people."

"Local prices of petroleum products have been reduced by P5-7 per liter since November. This reduction of 10-15%, however, is significantly lower than the 24.61% fall in the prices of Dubai crude over the same period," pointed out the CPP.

"The Filipino people must not only denounce the new round of price increases but must demand that oil companies roll back oil prices more substantially," said the CPP. "At the same time, they must demand a substantial decrease in the costs of mass transportation, electricity and water rates and in the prices of basic commodities and services and unite to push for an increase in the national minimum wage."

Rate (percent) of change in prices of gasoline, diesel and Dubai crude

Month           Gasoline*       Diesel*         Dubai±
2014-06         0.09        -1.84          2.37
2014-07         -0.63        -4.63          -2.13
2014-08         -3.55        0.69           -3.65
2014-09         -1.13        -1.03          -4.77
2014-10         -0.76        -3.94          -10.59
2014-11         -9.24        -8.82          -18.74
2014-12         -10.92        -16.82         -24.61

* raw data from Department of Energy Oil Price Monitor
± raw data from Dubai Mercantile Exchange Website