THE COUNTRY’S liquefied petroleum gas (LPG) supply increased to the equivalent of fifty days of inventory, driven by a seasonal decline in consumption that was further exacerbated by soaring prices, in keeping with the LPG Marketers Association, Inc. (LPGMA).
LPGMA Founder Arnel U. Ty said the nationwide demand plunged by 30% month on month in April, mainly as a consequence of high prices of LPG products.
Mr. Ty told reporters on Tuesday that the decline this yr has been more pronounced than in previous years when LPG demand would drop by 15% in the summertime months of March, April and May.
“That’s the rationale why the inventory of LPG without delay increases from 35 days to 50 days — because of demand reduction,” he said.
Mr. Ty noted consumers, especially those in rural areas, have shifted to charcoal and firewood for cooking materials as LPG costs surge.
Other than diesel and gasoline, the Philippines can also be a net importer of LPG. It sources 91.4% of its LPG supply from Asian countries.
The Middle East conflict has sent global oil prices soaring. Local LPG prices jumped by as much as P403 this month, pushing the prices to around P1,600 per 11-kilogram (kg) cylinder.
In an unexpected move, President Ferdinand R. Marcos, Jr. on Monday suspended excise taxes only on LPG and kerosene to cushion the impact of rising fuel costs on households, without halting levies on gasoline and diesel.
Scrapping excise tax on LPG is predicted to bring down prices by P3.36 per kilo or P36.96 per 11-kg cylinder.
“We already implemented P3 reduction in our members’ store, composed of around 20% of the full market. So, they (consumers) can get immediate relief from the suspension of the excise tax,” Mr. Ty said.
For the reason that current inventory was already charged with excise tax, he said that the group could have to “absorb” costs amounting to between P50 million and P70 million.
“Because we will recoup it when the time comes that excise tax in the long run might be reinstated,” Mr. Ty said.
To further beef up the country’s LPG stockpile, the Philippines has moved to acquire from other countries through a government-to-government arrangement.
Mr. Ty said the federal government and the private sector have secured around 22 million kilos of LPG, which is ready to reach between May 15 and June 1. Around 44 million kilos of LPG continues to be under negotiation. — Sheldeen Joy Talavera