Liquefied petroleum gas (LPG) prices may increase by P1 to P3 per kilogram in November as winter demand and international market movements put pressure on supply costs, although prices are unlikely to return to levels recorded during the March-April surge, an industry official said.
According to Arnel Ty, president of the LPG Marketers Association, the projected adjustment would depend largely on movements in international contract prices, shipping costs, supply conditions and demand from countries preparing for the winter season.
LPG currently sells for about P1,300 to P1,400 per cylinder, compared with around P1,600 during the sharp price increases in March and April, Ty said.
Although prices remain higher than last year's levels, he said the expected increase next month was unlikely to match the earlier surge.
In an interview on Dobol B TV on Thursday, Ty said every $50-per-ton change in the international contract price translates to an estimated P3-per-kilogram adjustment in local LPG prices.
Shipping costs and LPG premiums have also become more manageable, limiting the likelihood of another sharp increase, he said.
The Philippines remains dependent on imported LPG and is therefore vulnerable to fluctuations in international prices and demand, particularly in countries where consumption rises during colder months.
Ty said suppliers have been sourcing LPG from the United States instead of the Middle East, although shipments from the US involve longer shipping distances.
Demand for LPG typically increases during the winter season, particularly from December through February, as households in colder countries use more fuel for heating and other needs.
This seasonal demand could put additional pressure on international prices and affect the cost of LPG imports to the Philippines.
Ty cited the November US elections as another factor that could influence international oil prices, as producers and traders await the outcome before making decisions that could affect market movements.
Oil prices could ease after the elections, although the direction of the market remains uncertain, Ty said.
The projected increase of P1 to P3 per kilogram would still leave LPG prices below the levels reached during the March-April surge, he added.
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