NATION | NEWS

New Fuel And LPG Prices For The New Year

The fluctuations noted in the local fuel prices for January 2022 in the Fijian market are due to favourable movements in the international prices and international freight rates for Motor Spirit, Kerosene and Diesel, while the exchange rate strengthened based on November 2021 imports.
31 Dec 2021 12:30
New Fuel And LPG Prices For The New Year

The Fijian Competition and Consumer Commission (FCCC) has determined the new regulated prices of Unleaded Petrol, Premix, Kerosene, Diesel and LPG for January 2022.

 

The following new Fuel and LPG prices comes into effect from Saturday, 1 January 2022:

Retail Fuel Prices
• Motor Spirit from $2.75 to $2.74 per litre, a decrease of 1 cent per litre;

• Premix from $2.35 to $2.34 per litre, a decrease of 1 cent per litre;

• Kerosene price remains unchanged at $1.82 per litre; and

• Diesel from $2.31 to $2.34 per litre, an increase of 3 cents per litre.

 

Retail LPG Prices
• 4.5kg Cylinder from $18.11 to $17.34, a decrease of 77 cents per 4.5kg Cylinder;

• 12kg Cylinder from $48.30 to $46.24, a decrease of $2.06 per 12kg Cylinder;

• Bulk Gas* from $3.42 to $3.27, a decrease of 15 cents per kg; and

• Autogas from $2.29 to $2.19, a decrease of 10 cents per litre.

*Note: The price for Bulk Gas is Wholesale Vat Exclusive Price (VEP), while all other prices for Fuel and LPG products stated above is Retail Vat Inclusive Price (VIP).

 

The Fuel and LPG price review implemented by FCCC follows a one-month lag period, as such the January 2022 Fuel and LPG prices are based on the importations made in November 2021 by Fuel and LPG Companies. FCCC has used the Saudi Aramco Butane Contract Price (CP) for December 2021 to determine the LPG price for January 2022.

 

Fuel Price Change Reasons
The Fuel price in Fiji is impacted by the movement in Means of Platts Singapore (MOPS), the international freight rate and the exchange rate.

The fluctuations noted in the local fuel prices for January 2022 in the Fijian market are due to favourable movements in the international prices and international freight rates for Motor Spirit, Kerosene and Diesel, while the exchange rate strengthened based on November 2021 imports.

 

In January 2022, the local price for Motor Spirit and Premix will decrease as the gains noted from favourable movement of international price and international freight for Motor Spirit and
Premix outweighed the losses noted due to strengthening of the exchange rate.

The local price for Kerosene will remain the same in January 2022 as favourable movement noted in international price and international freight for Kerosene was balanced by strengthening of the exchange rate.

In January 2022, the local price of Diesel will increase as strengthening of the exchange rate outweighed the favourable movement noted in international price and international freight for diesel.

 

Crude Oil Market
Crude oil prices declined slightly in November 2021 due to following reasons:
1. Concerns regarding emergence of the new Omicron COVID-19 variant which resulted in surge of COVID-19 cases in Europe and other regions.

2. Easing of the energy crunch which had resulted in higher oil demand from the gas to oil switching as gas prices moved lower in major hubs.

3. Reinstatement of lockdown measures and mobility restrictions in Central Europe and Russia reduced the demand for transportation fuels and further derailed the global economic demand.

4. The US dollar jumped against a basket of other major currencies to its highest level since July 2020.

5. The investors weighed the impact of a potential release of crude oil from Strategic Petroleum Reserves (SPRs) in major consuming countries, while International Energy Agency (IEA) in its November 2021 monthly report forecasted a 1.5 mb/d increase in global oil supply in November and December.

6. The Organization of the Petroleum Exporting Countries (OPEC) Secretariat, International Energy Agency (IEA) and other major agencies projected global oil supply to exceed the global oil demand in the first quarter of 2022.

 

The news about the Omicron variant pushed oil prices sharply lower on worries that further mobility restrictions and lockdowns could dampen oil demand. These global economic factors
in November 2021 contributed to the change in the local Fijian prices for refined oil products for which the prices will be effective from 1 January 2022.

 

LPG Price Change Reasons
The LPG price in Fiji is impacted by the movement in Saudi Aramco Butane Contract Price (Saudi CP), the international freight rate and the exchange rate. The major reasons for the movement in prices for all LPG products in January 2022 in the Fijian market are due to favourable movement in Butane Contract Price (CP) and unfavourable movement in the international freight rate.

 

The gains noted from favourable movement of December 2021 butane CP outweighed the unfavourable movement noted in international freight and strengthening of the exchange rate based on November 2021 imports.

 

December 2021 Contract Price (CP) was the first decrease after a six-straight monthly increase of CPs. The lower December 2021 CP reflected more subdued market sentiment after Asian prices jumped to around seven years high, dampening end users’ appetite for costly domestic fuel and feedstock. Platts noted that supply from the Middle East, including ample flows from Iran was healthy enough to meet demand from North Asia during winter and from Chinese propane dehydrogenation plants that have raised production rates.

 

On demand side, Japan’s total LPG imports recovered by 13.46% from previous month to 826,000 metric tonnes. South Korea LPG imports increased by 10% in October as demand increased by about 5% during the month.

The month-on-month rebound in LPG consumption in South Korea had been attributed to higher vaccination rates, as 80% of the adult South Korean population was fully vaccinated in October.

The costlier LPG compared with naphtha in recent months also turned petrochemical makers away from propane and butane as an alternate cracker feedstock. Currently, naphtha remains a more economical feedstock than LPG.

These international market forces impacted the price of LPG products in the Fijian market in January 2022.

Fiji is directly impacted by the world market prices for both refined oils and LPG.

As such, any changes to the world market prices will be reflected in Fuel and LPG prices in Fiji.

The FCCC will conduct the next Fuel and LPG price review on 1 February 2022.

 

Feedback: ranobab@fijisun.com.fj



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