The decline in global fuel demand stalled the increase in fuel prices despite the rising tensions in the Middle East and the production reduction implemented by members of the Organization of Petroleum Exporting Counties (OPEC).
The Department of Energy-Oil Industry Management Bureau (OIMB) assistant director Rodela Romero said prices for diesel will decrease between P0.90 and P1.10 per liter and for kerosene between P1.00 and P1.20 per liter, while gasoline will increase by P0.40 to P0.60 per liter.
"The unexpected decline in fuel demand in big economies, including China and the U.S., coupled with the mixed reactions on the geopolitical conflict in the Middle East, influenced the movement of fuel prices," Romero said. "However, analysts say that the volatility in the energy markets is expected to continue," Romero added.
In an independent statement, American Automobile Association (AAA) spokesperson Andrew Gross echoed the DOE's assessment and noted a significant decline in pump prices in the U.S. market.
"The situation overseas with war in the Middle East and Ukraine has the oil market on edge. But this is also the time of year when we may see a bit of a lull in gasoline demand between the end of spring breaks and ahead of Memorial Day. So the national average for gas may waffle a bit with small increases, some flat days, and even some price dips," Gross said.
Separately, DOE-OIMB director IV Rino Abad pointed to OPEC's decision to cut supply production, which is increasing prices.
"Admittedly, the increasing price is brought about by the OPEC+ reduction," Abad said. "It is brought about primarily by the production cut, (and) not necessarily about the conflict."
Last month, Saudi Arabia and Russia led OPEC+ members to extend their voluntary production cuts until June to boost prices amid the geopolitical tensions in the Middle East and Ukraine.
The voluntary cuts were scheduled to expire at the end of March, but the OPEC+ members said the curbs would be extended for another three months.
Since the latest voluntary cuts were enacted in January, OPEC+ members have decreased their aggregate production targets by about 2.2 million barrels a day.
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