07/03/2026
A lot of people keep asking why fuel prices go up even if the stations still have old stock. Here’s the explanation.
1. Oil prices follow the global market, not the local stock
Fuel sold in the Philippines is priced based on international oil prices, mainly benchmark prices from the Mean of Platts Singapore (MOPS).
MOPS reflects the daily trading price of fuel in Asia.
Local oil companies adjust their pump prices depending on the weekly average of these global prices.
So even if a gas station still has old fuel in its tanks, the replacement cost (the price to buy the next shipment) may already be higher. Companies adjust prices early so they don't sell fuel at a loss.
2. The Philippines has a deregulated oil industry
Since the Downstream Oil Industry Deregulation Act of 1998 (Republic Act 8479), the government does not control fuel prices.
Instead:
* Oil companies set their own prices
* Prices are influenced by:
- global crude oil prices
- foreign exchange (peso vs dollar)
- shipping and refining costs
The government (through the Department of Energy) only monitors prices and ensures competition.
3. Why price changes usually happen every Tuesday
Most companies announce price adjustments every Monday, implemented Tuesday.
This weekly pattern exists because:
* Companies review last week’s global price average
* Competitors match adjustments to stay competitive
Major players like:
* Petron Corporation
* Pilipinas Shell Petroleum Corporation
* Chevron Philippines (Caltex)
usually move prices at the same time.
4. Even if stations have old stock
Gas stations often still increase price because:
* Fuel deliveries are continuous
* Tanks usually contain mixed batches
* Retailers follow the price set by their oil company supplier
So the price reflects the current market replacement cost, not just the cost of the fuel already stored.
✅ Simple example
- Station bought fuel at ₱55/L
- Global price rises → next shipment will cost ₱60/L
If they keep selling at ₱55, they lose money when they restock.
So they raise prices to prepare for the higher replacement cost.
5. Who really controls fuel prices?
No single entity directly controls them. Prices are mainly influenced by:
1. Global oil traders
2. OPEC production decisions (e.g., OPEC)
3. Exchange rate of Philippine peso vs US dollar
4. Oil companies in the Philippines
Important:
Because the Philippines imports most of its oil, it is very sensitive to global price changes.
