As debates heat up over calls to scrutinize their books and financial records, the country’s oil companies trimmed down prices by P1.50 per liter for gasoline and P1 per liter for diesel and kerosene beginning at sundown Thursday.

The round of reductions was initiated by major player Pilipinas Shell Petroleum Corp. which advised dealers of downward adjustments on suggested retail prices effective 6 p.m. of Aug. 20, simultaneous to the price cut advisory of independent player Seaoil Philippines.

“Shell will roll back prices of gasoline to its dealers to reflect the reduction in product costs,” company vice president Roberto S. Kanapi said.

Leading player Petron Corp. also rolled back its pump prices effective last midnight, echoing “lower international prices” as justification.

Seaoil noted that the price cut “is to reflect movements in international prices.”

With the latest reduction, prevailing pump prices in Metro Manila now range from P36.84 to R42.49 per liter for unleaded gasoline, and diesel prices from P27.15 to P33.03 per liter.

Based on the Department of Energy’s (DoE) monitoring, the spot price of unleaded gasoline as referenced on the Mean of Platts Singapore (MOPS) softened in recent trading days compared to last week.

Market analysts said major factors influencing global oil prices are hinged on lingering weak demand vis-à-vis supply and the stock markets’ inkling of near-term economic recovery.

In fact, global prices seesawed in the past two weeks – swinging wildly that domestic oil companies had to significantly increase their prices at one point then roll back the next.

Industry watchers opined that “the market continues to trade on economic optimism and not on supply and demand.”

The Paris-based International Energy Agency (IEA) already raised demand estimates for the rest of 2009 and 2010 on forecasts of better economic growths for developing economies, primarily in Asia.
In the domestic market, though, issues are still confined to pricing and policy formulations. As consumers see weekly adjustments at the pumps, the call for the industry to revert to a regulated setup has recently gained traction.