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More oil price rollbacks anticipated as demand eases

By The President NewsPosted on
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MANILA — According to an economist member of Congress, fuel prices may have peaked and more monthly price rollbacks are possible as the “supply deficit of global oil is narrowing, and supply is increasing at a faster rate than demand”.

“The Filipino people, who are net buyers of oil from the world market, can expect some slight to moderate relief on oil prices as global oil supply-demand imbalance appears to be easing,” Albay Rep. Joey Salceda predicted over the weekend.

He estimates that oil price rollbacks could last until the end of the year.

According to Salceda, the chairman of the House Ways and Means Committee, the oil supply deficit in July “narrowed to around 600,000 stock tank barrels, the lowest for the entire year 2022.”

“Oil supply in July also grew by 0.28 percent but demand grew by just 0.07 percent,” added Salceda, who anticipates the stabilization of the prices of fuel both in the world and local market.

“With the US Federal Reserve maintaining its policy of gradual rate hikes, and with domestic pressure among US leaders to increase oil supply, as well as global adjustment to a stalemate in Ukraine, I expect net price reductions on oil prices every month for the rest of 2022. Oil future data appears to say so, as well,” he said.

Likewise, the former investment analyst for global banks anticipates to see “something similar to the recovery post-Global Financial Crisis, when oil prices peaked in April 2011, before settling down by September the same year.”

“I see it as possible that global crude prices could go below $80 for the first time by October this year. From there it will play between $80 and $95 until global tensions ease permanently,” he said.

“So, we can begin changing our mindset from oil prices to food prices, which is experiencing non-oil threats, such as climate,” he added.

The tax laws governing Philippine offshore gaming operators (POGO) may need to be reviewed by both the Senate and the House of Representatives, given that the cash-strapped government urgently needs funds for pandemic recovery.

Camarines Sur Rep. LRay Villafuerte proposed that lawmakers collaborate with officials of the Philippine Amusement and Gaming Corp. (PAGCOR), if only to prevent further POGO exodus and allow the Marcos administration to raise funds for social programs.

“With the new government in need of much bigger revenue streams to adequately fund its priority social welfare programs, among others, the Congress may have to engage the PAGCOR in an early revisit of the POGO law,” Villafuerte suggested.

This is merely to “determine if rationalizing the tax rates or providing additional incentives is necessary to keep the remaining POGOs from leaving.”

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