LPG prices to fall P3 per kilo before possible P10 hike
MANILA, Philippines — Consumers could get an LPG price cut of at least P3 per kilogram this week, only to face a much larger increase days later as global costs push higher.
Arnel Ty, president of the LPG Marketers Association, said Monday, September 28, that prices were expected to fall by at least P3 per kilogram following the government's three-month suspension of excise taxes on liquefied petroleum gas and kerosene.
But Ty also warned of a possible P10-to-P15-per-kilogram increase as early as October 3, depending on the final computation of world-market prices.
President Ferdinand Marcos Jr. signed Executive Order 125 on September 25, granting the temporary excise-tax relief.
Ty said the industry learned through coordination with the Bureau of Customs that the tax-driven reduction would be implemented within the week.
Republic Gas Corp., or Regasco, will cut its LPG price by P3 per kilogram starting Wednesday, September 30.
The reduction could reach P3.36 per kilogram once the 12% value-added tax imposed on the excise tax is included, Ty said. The Department of Energy has yet to formalize the final equivalent price adjustment.
"Sa ngayon, Department of Energy na po ang magpo-formalize kung ano po ang dapat na equivalent po niyan," Ty told dzMM. ("For now, the Department of Energy will formalize the appropriate equivalent reduction.")
Relief may be short-lived
The tax relief could be quickly overwhelmed by a projected increase in LPG prices in early October.
Ty said the final adjustment would be calculated on October 1 and could take effect October 3.
He attributed the expected increase to higher world-market prices and shipping premiums amid geopolitical tensions in West Asia.
"Lubhang napakataas po ng inangat ng premium cost. It is almost $200 plus per metric ton," Ty said. ("The premium cost has risen sharply. It is almost $200-plus per metric ton.")
The excise-tax suspension will remain in effect despite the expected market-driven increase, potentially cushioning what consumers would otherwise pay.
Under the directive, the tax relief can last for up to three months. The excise tax may be restored one week after the one-month average price of Dubai crude falls below the $80-per-barrel benchmark.
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