Biden to call for three-month suspension of federal gas tax as prices skyrocket

WASHINGTON - US President Joe Biden will ask Congress Wednesday to suspend the federal gas tax for three months as skyrocketing prices cause widespread anger among Americans just months before crucial mid-term elections. 

The White House wants to discontinue the tax of 18 cents per gallon (3.78 liters) until September and will call on US states, which also tax at the pump, to do the same to "provide direct relief to American consumers who have been hit with Putin's price hike," a senior administration official said.

The official noted that prices had gone up almost $2 a gallon since Russian President Vladimir Putin began building up forces on the Ukrainian border earlier this year.

Federal taxes on gas and diesel help fund the Highway Trust Fund, which maintains roads and supports public transport, but Biden will call on Congress to ensure the fund does not suffer from the lost revenue.

"With our deficit already down by a historic $1.6 trillion this year, the president believes that we can afford to suspend the gas tax to help consumers while using other revenues to make the Highway Trust Fund whole for the roughly $10 billion cost," the official said.

Facing growing public anger over the rising cost of gas, several states including New York and Connecticut have already suspended fuel taxes, while others have delayed planned tax increases.

Biden has taken steps to alleviate the pain at the pump after Putin's February 24 invasion of Ukraine led to soaring fuel prices not just in the United States but worldwide, exacerbating inflation already on the rise.

Those measures include releasing a million barrels of oil per day from the Strategic Petroleum Reserve, negotiating the release of an additional 60 million barrels from international partners and expanding access to biofuels.

But with average gas prices across the country near $5 a gallon, the Biden administration is keen to lessen the pain consumers feel over rising prices ahead of November mid-term elections that could see the Democrats lose control of Congress.

Agence France-Presse

Major oil producers to consider cuts after price slide

DUBAI - Major oil producers meet in Abu Dhabi on Sunday to consider reverting to output cuts after a sharp slide in crude prices revived fears of a 2014-style crash.

Oil prices shed a fifth of their value in just one month after surging to a four-year high in early October, driven by a combination of factors centered on higher supply and fears of sluggish demand.

Brent crude dropped below $70 a barrel on Friday for the first time since April while the New York's West Texas Intermediate (WTI) sank below $60 a barrel, a nine-month low.

The United States has upped production of shale oil, while Saudi Arabia, Russia and others have raised supplies of crude amid signs of slowing demand.

The slide also comes during signs of a softer-than-expected impact from US sanctions on Iran oil exports.

"Prices have been falling amid a continued rise in crude supplies from big producers, such as Saudi Arabia, Russia and the US, more than compensating for lost Iranian barrels," Forex.com analyst Fawad Razaqzada told AFP.

"With the Iranian sanctions not being as severe as initially feared, officials from the OPEC and non-OPEC producers may discuss at the weekend the need to bring compliance back down towards the 100-percent level or risk another 2014-style slide in prices," he said.

Energy ministers of top producers Russia and Saudi Arabia will join other OPEC and non-OPEC officials for the meeting of the Joint Ministerial Monitoring Committee, which oversees production levels.

The world's second and third crude producers -- after they were overtaken by the United States thanks to shale oil -- Russia and Saudi Arabia are the core of an alliance of producer nations that succeeded in solidifying oil prices after the 2014 crash.

Through large production cuts starting at the beginning of 2017, they managed to push up oil prices from below $30 a barrel to over $85 a barrel in October, strongly improving their revenues.

But the producer nations eased the output cuts in June after signs of a tight market and higher prices, allowing hundreds of thousands of extra barrels into the market.

Saudi Arabia raised its production from around 9.9 million barrels per day in May to around 10.7 million bpd in October, according to Energy Minister Khalid al-Falih.

Kuwait, Iraq, Russia and the United Arab Emirates also boosted their output. 

Cailin Birch, analyst at the Economist Intelligence Unit, said a slowing oil demand is beginning to appear in China, the world's largest importer of crude oil. 

"The recent drop in oil prices reflects a combination of factors. For one, signs of slowing oil demand are beginning to appear; the rate of GDP growth in China is beginning to ease," Birch told AFP. 

The meeting, which will also be attended by the oil ministers of Kuwait, Venezuela and host nation the UAE, is not due to make decisions but will most likely send signals.

The JMMC, a technical committee, is expected to make important recommendations on production cuts to a key ministerial meeting in Vienna next month for the OPEC and non-OPEC producers.

Commerzbank, Germany's second-largest lender, said Friday oil producers must act to prevent a free fall of prices.

"If they fail to signal any intention to reverse the latest increase in production, oil prices threaten to slide further," the bank said in a note.

source: news.abs-cbn.com

Why Indonesia raised fuel prices by more than 30 pct

JAKARTA - Indonesia's new president raised subsidized fuel prices by more than 30 percent on Monday, a move that is expected to save the government of Southeast Asia's biggest economy more than $8 billion next year.

President Joko Widodo's first major economic policy decision since taking the helm in October will help provide the necessary fiscal space to fund his reform agenda and tackle the country's twin budget and current account deficits.

"The government has decided to redirect fuel subsidies," Widodo told reporters at the presidential palace. "The country has needed a (larger) budget for infrastructure, healthcare and education but instead spent it on subsidizing fuel."

Indonesian fuel prices, among the cheapest in the world, were raised by 2,000 rupiah ($0.16) per liter, with subsidized gasoline now costing 8,500 rupiah a litre and diesel 7,500 rupiah.

The fuel price hike was welcomed by economists, but immediately sparked small protests and long queues at petrol stations in the capital.

"The move is encouraging since it suggests that (Widodo) is serious about economic reform in Indonesia, and is even prepared to take steps that may prove unpopular in the short run," said Gareth Leather of Capital Economics.

Finance Minister Bambang Brodjonegoro said he expected inflation to rise 2 percent to 7.3 percent this year after the fuel price rise, and that the inflationary impact would be felt through February 2015.

Economists said Bank Indonesia may need to raise interest rates as early as this month to tame inflation. "We expect BI to raise 25 bps either this month in an unscheduled meeting or in a monthly policy meeting in December depending on the impact," said Eric Sugandi, economist with Standard Chartered.

Analysts expected the news to support Indonesian stocks and bonds when markets open early Tuesday. The rupiah IDR= was little changed after the announcement, down 0.2 percent at 12,202 per dollar.

Raising fuel prices is a sensitive issue that typically sparks protests and contributed to the downfall of long-serving autocrat and then president Suharto in 1998.

The decision to raise fuel prices was criticised by trade unions and some opposition politicians.

"This is not a wise decision right now," said Bobby Rizaldi, a member of the Golkar party, part of the opposition majority coalition. "Electricity prices have just been raised recently, the currency has been under pressure, and now the inflation will be higher than we anticipated at the beginning of the year."

Officials within Widodo's government have said any money saved from reduced subsidies would be diverted to spending on infrastructure, agriculture, education, and health projects.

Social assistance will also be available to 15.6 million people from Tuesday, Chief Economics Minister Sofyan Djalil told reporters, in a government drive to soften the impact of the fuel price rise on the poor.

source: www.abs-cbnnews.com

Oil firms to slash pump prices

Oil retailers announced that prices of its fuel products will be slashed on Tuesday.

Shell and Seaoil will cut the prices of diesel by P0.45 and kerosene by P0.25 per liter effective 12:01 a.m.

Petron, meanwhile, will reduce the prices of diesel and kerosene by 6 a.m.

Eastern Petroleum will roll back diesel prices by P0.60 per liter effective 12:01 a.m., while Phoenix Petroleum and Total will cut diesel prices by P0.45 effective 6 a.m.

There are no changes in gasoline prices. -- Report from Alvin Elchico, ABS-CBN News

source: www.abs-cbnnews.com

Gas sold at P300/liter in Leyte town?

MANILA – Energy Secretary Jericho Petilla on Friday said he received reports that some fuel vendors are selling gas at P300 per liter in the typhoon-hit town of Jaro in Leyte.

Petilla said he was not able to verify the report, but he said he won’t be surprised if fuel prices are jacked up because one of the gas stations in the area was shut down.

“Hindi natin nahuli ito, pinuntahan natin, wala naman kaming nahuling nagbebenta. Pero ako’y hindi magtataka kung may magbebenta ng P300 per liter because sa area na ‘yan, medyo natigil ang isang gasolinahan sa pag-operate,” he told dzMM.

Retail prices of petroleum products in Metro Manila range from P40 per liter to P52 per liter.

Petilla assured survivors of the typhoon in the Visayas that there is no shortage of fuel, but he admitted that there is difficulty bringing the supply to the affected areas.

“Sa buong Eastern Visayas, wala tayong shortage sa fuel. Sobra-sobra ang gasolina natin sa area na ‘yan, ang problema lang, hindi dumadating sa mga lugar na dapat nilang datnan,” he said.

The energy chief said around 9 to 10 tankers from Manila have arrived in the Visayas, but distribution has been delayed due to security issues.

He said the tankers were stalled in Catbalogan for a day because of these concerns.

However, Petilla said that as soon as military forces were able to provide security, the tankers proceeded to distributing the supply to all affected areas, except Tacloban City.

Petilla explained that gas stations in Tacloban initially refused to operate, not because of security reasons, but because no banks were open.

“Ang problema nila, walang bangko dito sa Leyte na bukas. Kapag ikaw ay may sale sa isang araw, saan mo ilalagay? Hindi mo naman pwede ilagay sa vault, you have to deposit it somewhere,” he said.

On Friday, several banks in Ormoc, a 2-hour drive from Tacloban, resumed operations which allowed a gas station in Palo to open as well.

Fuel rationing

While there is ample supply of fuel, Petilla said distributors are directed to ration the supply.

He said motorcycles are only allowed to purchase 2 liters of gasoline while large vehicles like buses and trucks are allowed to buy up to 20 liters.

“We cannot do non-rationing at this time kasi nga baka abusuhin naman ng mga scrupulous na mga tao,” Petilla said.

“Iniiwasan din natin ang mga tao magbenta ng bote-bote. Kapag pinayagan natin bumili ng isang drum, pupunta ‘yan sa isang lugar at magbebenta,” he added.

Power restored by Christmas

Petilla said authorities are now working double time to restore electricity in the typhoon-hit areas.

He said the Department of Energy is targeting December 24 to restore power in Samar, Leyte, Panay island, Iloilo and Negros.

Petilla clarified, however, that restoring power in the far-flung areas may take longer.

“Ito ‘yung mga bayan, kasi sa mga libliban na barangay, that will take a little bit of effort na makasama sa December 24,” he said.

He added that authorities will try their best to include even the smallest barangays to have power by Christmas.

source: www.abs-cbnnews.com

Flying V to slash fuel prices

MANILA, Philippines – Flying V has announced that it will roll back its fuel prices on Sunday.

The firm said effective 12:01 a.m., prices of its premium and unleaded gasoline will be reduced by P0.40 per liter while diesel prices will be slashed by P0.50 per liter.

Oil company Seaoil also implemented a rollback on Saturday. -- Report from Alvin Elchico, ABS-CBN News

source: abs-cbnnews.com

Expect at least P1 increase in fuel prices this week - small retailers group

MANILA - After 13 weeks of reductions, oil companies are poised to increase prices at the pump by at least a peso, according to the head of the country's group of small retailers.

Fernando L. Martinez, chairman of the Independent Philippine Petroleum Companies Association, said prices could go up "a little over a peso for all products."

So far this year, prices have fallen P3.92 a liter for gasoline, and by P5.06 for diesel.

In Metro Manila, diesel retails for between P37.20 and P39.95 per liter, while gasoline, P43.65 to P51.27.

Industry players said EU sanctions against Iran, which took effect July 1, could reverse the dip in prices, pushing them higher over the next few months.

The embargo stemmed from Iran's nuclear program, which Tehran insists as solely for peaceful purposes.

Besides the oil embargo, the week-on-week 14-centavo depreciation of the peso against the dollar from P42.27 two weeks ago to P42.41 last week is also expected to contribute to the projected increase in pump prices this week.

source: interaksyon.com