Oil price peaks to US$86, highest since 2014 , says Tokome

 THE increase in oil price this month, peaking at US$86 (about K294.92) a barrel, is the highest since 2014, according to Puma Energy (PNG) Ltd.

Country manager and director Hulala Tokome said the country was at the mercy of global oil prices.

He noted that China’s power shortage had increased oil demand as power generators moved away from expensive gas and coal to diesel and fuel oil.

“And for our pricing, we have a one-month lag effect,” he told The National.

“The oil price has risen this month peaking at US$86 a barrel, the highest since 2014.

“China’s power shortage is increasing oil demand as power generators move away from expensive gas and coal to diesel and fuel oil instead.”

Tokome said the Organisation of the Petroleum Exporting Countries (Opec) remained disciplined to maintain its current crude oil output policy, despite pressure to boost production further which was causing global oil prices to continue increasing. According to the Independent Consumer and Competition Commission, Papua New Guinea was not a major producer of crude oil, hence the country’s price was determined by supply and demand on the world market by the biggest producers and consumers of oil.

Commissioner and chief executive officer Paulus Ain had previously told The National that the world market price affected PNG.

Therefore an increase in the global oil price would mean an increase in the petroleum products – petrol, diesel and kerosene – in the country.

The petrol selling price for this month is K3.79, diesel at K3.28 and kerosene is at K3.01.

The National / Pacific Mining Watch

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