Ok. I checked today and the world's crude oil prices being traded went down by about 4 pesos. Its trading in London by US$67.32 (US$1:48) or about 3,231.36 php per barrel.
Now, a barrel of crude oil contains 159 liters of oil. So, crude oil should have been passed to us only 20.30 php per liter. That is, if these oil companies get their crude in London.
If these oil companies claim that they get their crude from Singapore, the news said that even prices there fell to US$67 per barrel. That's even lower than our previous calculation.
Of course, oil companies may have to factor in freight costs and profits.
The average retail price of a gallon of gasoline in seven industrialized countries cost US$ 4-5 dollars (US$1:48). That's about 240 pesos per gallon. Now, since there is about 3.78 liters per gallon, gasoline should probably fetch here at around 63.49 pesos per liter, still lower than ours here.
But, that's not the point.
These oil companies are raking profit after profit says Oil Price Watch Chairman Roberto Concepcion Jr. When it was time to lower prices, oil companies did so ginger-ly. Now, why are companies raising their retail oil prices now?
According to a hedge fund analyst, oil companies are anticipating the recession. The World Bank says the recession would happen in the third quarter of this year due to weak economic activity. Should the economy weaken as predicted, this will surely impact on commodity prices, including oil.
Oil companies should explain this to the public in a more efficient way. I think the problem lies on the ineffective way these companies handle their external communications. People would understand if they just act with transparency.