Think local gasoline and diesel prices are ridiculous now? You haven’t seen anything yet.
In a recent Laging Handa press briefing, the Department of Energy (DOE) said that one of the variables currently affecting local fuel prices is the foreign exchange rate (FOREX).
According to DOE undersecretary Gerardo Erguiza, the cost at the pump may rise further if the peso continues to weaken.
“Maraming mga variables sa pagtaas ng presyo. Una, of course yung cost, nakita natin na bumababa at tumataas. Last week, we noticed na nag-fluctuate ito pababa. And ang nakita namin, bakit tumaas, it’s because of one variable, yung FOREX,” Erguiza said during the interview.
The official explained further, saying that the Philippines buys its oil products based on the US dollar. Erguiza said that if the dollar goes up, so do local fuel prices.
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“Nung nag-trend ito [on Monday], lumabas na ang global market price sa trading, may bahagyang pagtaas ho. So, kung ganito yung tutuluyan nito, magsasama ho, mag ko-compound ang pagtaas ng presyo [fuel] at nung pagtaas ng dollar,” he stressed.
“So we just hope na yung dollar, yung FOREX naman ang bumaba ho ngayon. Based on these two variables, kung talagang tumaas ito pareho, medyo tataas ho talaga yung presyo.”
Another factor affecting the global oil trade is continued tensions in Europe and the Middle East, which experts predict might drive the price of oil to as high as $135 (over P7,300) per barrel.
Just to put things in perspective, one US dollar as of today, June 29, is equivalent to P54.76. Well, we’ll ready our wallets, we guess.