Pacific Fuel Price Monitor

Transcription

1 Pacific Fuel Price Monitor APRIL JUNE 2014 (Q2 2014) WHAT S INSIDE 1. Pacific fuel price monitor at a glance 2. Regional retail fuel prices (including taxes and duty) 3. Unleaded motor gasoline (mogas) prices (including and excluding taxes and duty) 4. Automotive diesel oil (ADO) prices (including and excluding taxes and duty) 5. Kerosene prices (including and excluding taxes and duty) 6. Liquefied petroleum gas (LPG) 7. International market pricing trends 8. Regional fuel specifications 9. Glossary and conversions LIQUIFIED PETROL 1. PACIFIC FUEL PRICE MONITOR AT A GLANCE Mogas American Samoa again had the lowest tax inclusive price by a significant margin, followed by Kiribati, Hawaii, all the FSM states and Samoa. Pre-tax, the lowest costs were in Sydney, American Samoa, Samoa, Hawaii and Fiji. The highest retail mogas prices, by a substantial margin were found in Cook Islands, Wallis and Futuna, Niue and French Polynesia while the highest pre-tax costs were Cook Islands, Wallis and Futuna, Tuvalu and Niue. Volume weighted the best performing markets were, once again, American Samoa and Samoa. ADO Samoa, American Samoa and Fiji had lowest cost (pre-tax price) of all the island markets, all of which were lower than Hawaii and Darwin. Tax inclusive, the clear winners were American Samoa by a large margin, followed by Fiji, FSM and Samoa. Volume weighted, the best performers were Samoa, American Samoa and Tonga. Highest ADO retails costs were in Cook Islands, Wallis and Futuna, Tuvalu and Niue. Kerosene Kiribati had the lowest pre-tax and tax inclusive kerosene prices followed by American Samoa, Fiji ad Samoa. The highest kerosene prices, by a significant margin were in Wallis and Futuna, Niue, Palau and Tuvalu. LPG Fiji had the lowest LPG prices while Palau, Niue, Wallis & Futuna and Vanuatu the highest, all of which were more than double that of Fiji. Crude oil Crude oil prices increased markedly in the April June 2014 quarter. 1 P a g e

2 USD per Litre 2. REGIONAL RETAIL FUEL PRICE COMPARISON (including taxes and duty) Figure 1: Regional retail prices including duty and taxes 3.00 Average retail fuel prices including tax and duty Retail Mogas Price Retail ADO Price Retail Kerosene Price Pacific Island Average Mogas Price Pacific Island Average ADO Price Pacific Island Average Kerosene Price Key observations general There is a wide variance in PICT fuel prices ranging from around USD per litre in American Samoa to USD in Cook Islands, Wallis and Futuna, Niue and French Polynesia. Pre-tax margins above the Platts average mogas MOPS over the quarter are in the range of US 20 cents per litre for American Samoa to about US 140 cents per litre in Cook Islands reflects a wide range of commercial margins and logistics costs within PICTs. American Samoa, Samoa and Fiji fuel costs compare very favourably with the regional reference markets of Australia, New Zealand, Singapore and Hawaii. American Samoa and Samoa are achieving excellent fuel prices compared with their relative market size for both mogas and ADO. Kiribati is achieving very favourable fuel prices related to government pricing policies. Wide discrepancies in regional costs and prices represent opportunities for PICTs to work on achieving more favourable fuel prices into the future. Varying tax treatment and market size of each PICT can account for significant price differences. The major PICT markets of French Polynesia, New Caledonia, Papua New Guinea and Solomon Islands all have significant potential to achieve lower fuel costs. Fiji, as a regional supply centre, high total import volume and re-exports has some room for improvement. Tonga, Vanuatu, FSM and Palau all have a similar market size with Tonga showing the best performance. Cook Islands and Wallis and Futuna have extremely high fuel prices relative to their volumes 2 P a g e

3 US Cents per liter US Cents per liter 3. MOGAS (UNLEADED PETROL) PRICES Figure 2: Retail mogas price sorted by retail price 300 Retail mogas price sorted by retail price Taxes (Duty plus VAT) Mogas Retail Pre-tax Price Platts Benchmark 92 RON ULP Platts Benchmark 95 RON ULP Pacific Average Pre-tax Retail Price Figure 3: Retail mogas price sorted by underlying cost 300 Retail mogas price sorted by underlying cost Taxes (Duty plus VAT) Mogas Retail Pre-tax Price Platts Benchmark 92 RON ULP Platts Benchmark 95 RON ULP Pacific Average Pre-tax Retail Price 3 P a g e

4 USD per Litre USD per Litre Figure 4: Regional prices of mogas (excluding tax and duty) 2.50 Mogas price excluding tax and duty Average MOPS 95 RON Retail Prices Wholesale Prices Average MOPS 92 RON Pacific Average retail price Pacific Average wholesale price Figure 5: Regional price of mogas (including tax and duty) 3.00 Mogas price including tax and duty Average MOPS 95 RON Retail Prices Wholesale Prices Average MOPS 92 RON Pacific Average retail price Pacific Average wholesale price 4 P a g e

5 Mogas price USD/Litre Figure 6: Mogas retail prices 2Q-2014 and annual volume Mogas prices excluding tax & duty and annual volumes Key: 1. American Samoa 2. Cook Is. (Rarotonga) 3. Fiji 4. French Polynesia 5. FSM 6. Kiribati 7. New Caledonia 8. Niue 9. Palau 10. Papua New Guinea 11. Samoa 12. Solomon Is. 13. Tonga 14. Tuvalu 15. Vanuatu 16.Wallis & Futuna Mogas annual demand (kilolitres) *Note: For figure 6.0 total and mogas volume for New Caledonia is projected over 1995 data and it s an SPC estimate. The centre of the bubble represents the price. Key observations motor gasoline (mogas, petrol) Retail Mogas prices vary immensely (Figure 2), ranging from about USD (American Samoa) to USD 2.64 per litre (Cook Islands). There is also a very wide variation between lowest and the highest mogas pre-tax costs (Figure 3) in the Pacific, ranging from US 91 cents per litre in American Samoa to USD 2.11 in Cook Islands, which is not fully explained by economies of scale. American Samoa, Samoa and Fiji pre-tax costs rival those of the regional reference markets of Sydney, Australia and Honolulu, Hawaii and are lower than Auckland, New Zealand and Darwin, Australia. The most costly PICT group, being Cook Islands, Wallis and Futuna, Tuvalu and Niue are US cents per litre higher than American Samoa. 5 P a g e

6 US Cents per liter US Cents per liter 4. AUTOMOTIVE DIESEL FUEL PRICES Figure 7: Retail diesel price sorted by retail price 300 Retail diesel price sorted by retail price Taxes (Duty plus VAT) Platts Benchmark 10ppm Pacific Average Pre-tax Retail Price Diesel Retail Pre-tax Price Platts Benchmark 500ppm Figure 8: Retail diesel price sorted by underlying cost 300 Retail diesel sorted by underlying cost Taxes (Duty plus VAT) Diesel Retail Pre-tax Price Platts Benchmark 10ppm Platts Benchmark 500ppm Pacific Average Pre-tax Retail Price 6 P a g e

7 USD per Litre USD per Litre Figure 9: Regional prices of diesel (excluding tax and duty) 2.25 ADO prices excluding tax and duty Average MOPS 10ppm Retail Prices Wholesale Prices Average MOPS 50ppm Average MOPS 500ppm Pacific Average Retail Price Pacific Average Wholesale Price Figure 10: Regional price of diesel (including tax and duty) 2.75 ADO prices including tax and duty Retail Prices Wholesale Prices Average MOPS 10ppm Average MOPS 50ppm Average MOPS 500ppm Pacific Average Retail Price Pacific Avergae Wholesale Price 7 P a g e

8 Diesel price USD/Litre Figure 11: Diesel retail prices 2Q-2014 and annual volume Diesel prices excluding tax & duty and annual volumes Key: 1. American Samoa 2. Cook Is. (Rarotonga) 3. Fiji 4. French Polynesia 5. FSM 6. Kiribati 7. New Caledonia 8. Niue 9. Palau 10. Papua New Guinea 11. Samoa 12. Solomon Is. 13. Tonga 14.Tuvalu 15. Vanuatu 16. Wallis & Futuna Diesel annual demand (kilolitres) *Note: For figure 11, total and diesel volume for New Caledonia is projected over 1995 data and it s an SPC estimate. The centre of the bubble represents the price. Key observations automotive diesel oil (ADO) Retail ADO prices vary immensely (Figure 7), ranging from about USD 1.05 (American Samoa) to over USD 2.57 per litre (Cook Islands). There is also a very wide variation between lowest and the highest ADO pre-tax costs (Figure 8) in the Pacific, ranging from US 94 cents per litre in Samoa to USD 2.10 in Cook Islands. Similar to the Mogas situation, American Samoa, Samoa, Fiji and Tonga pre-tax ADO costs rival those of the regional reference markets of Sydney, Australia and Honolulu, Hawaii and are lower than Auckland, New Zealand and Darwin, Australia. The most costly PICT group, being Cook Islands, Wallis and Futuna, Tuvalu and Niue are US cents per litre higher than Samoa. 8 P a g e

9 US Cents per liter US Cents per liter 5. KEROSENE PRICES Figure 12: Retail kerosene price sorted by retail price 250 Retail kerosene price sorted by retail price Taxes (Duty plus VAT) Platts Benchmark Jet/kerosene Kerosene Retail Pre-tax Price Pacific Average Pre-tax Retail Price Figure 13: Retail kerosene price sorted by underlying cost. 250 Retail kerosene sorted by underlying cost Taxes (Duty plus VAT) Kerosene Retail Pre-tax Price Platts Benchmark Jet/kerosene Pacific Average Pre-tax Retail Price 9 P a g e

10 USD per litre USD per Litre Figure 14: Regional prices of kerosene (excluding tax and duty) Kerosene price excluding tax and duty Retail Price Wholesale Price Average MOPS Asian Jet/Kerosene Pacific Average Retail Price Pacific Average Wholesale Price Figure 15: Regional prices of kerosene (including tax and duty) Kerosene price including tax and duty Retail Price Wholesale Price Average MOPS Asian Jet/Kerosene Pacific Average Retail Price Pacific Average Wholesale Price 10 P a g e

11 USD per Kg Key observations kerosene Retail kerosene prices vary immensely (Figure 12), ranging from about USD 0.89 (Kiribati) to over $2.32 per litre (Wallis and Futuna). The most expensive retail kerosene, being in Wallis and Futuna, Niue, Palau and Tuvalu are US cents per litre higher than Kiribati. There is also a very wide variation between lowest and the highest kerosene pre-tax costs (Figure 13) in the Pacific, ranging from US 94 cents per litre (Kiribati) to USD 2.10 (Palau). The most costly kerosene, being Palau, Niue, Tuvalu and Wallis and Futuna are US cents per litre higher than Kiribati. Figure 6. LIQUIFIED 16: Regional PETROLEUM prices of LPG GAS (including (LPG) PRICES tax and duty) Figure 16: Regional prices of LP gas (including tax and duty) Regional retail LPG price Retail Price Wholesale Price Average Saudi Aramco Butane Average Saudi Aramco Propane Pacific Average Retail price Pacific Average Wholesale price Key observations - LPG Fiji has the lowest LPG retail and wholesale prices at just over USD 2.20/Kg and USD 1.70/Kg respectively. Palau, Niue and Wallis and Futuna had the highest retail LPG prices which are all more than double that of Fiji, closely followed by Cook Islands, Samoa and Tuvalu. Saudi Aramco pricing which is published monthly is the acknowledged LPG benchmark price for this region. Average Saudi Aramco prices for propane and butane during the April June period were USD 0.80 USD 0.84 per kg respectively. There remains significant potential to reduce wholesale and retail LPG prices in many PICTs. 11 P a g e

12 7. INTERNATIONAL MARKET TRENDS Figure 17: Comparison Singapore gasoline (mogas), diesel (gas oil), jet fuel/kerosene and Dated Brent crude oil. Source: Platts Asia-Pacific/Arab Gulf Marketscan Key observations crude oil The Asia Pacific benchmark Dated Brent crude increased toward the end of the Quarter, defying a relatively long period of stagnant prices since June PICTs are part of the Asia Pacific fuel market with Singapore the recognised regional trading market and regional petroleum refining and distribution centre. The pricing benchmarks for PICT fuel markets are traded Singapore prices for diesel (gasoil) with maximum 10, 50 and 500 ppm Sulphur, gasoline (92 and 95 RON) and dual purpose kerosene (DPK) for both jet aviation fuel and for household kerosene. 12 P a g e

13 Figure 18: Refiners margin Daily variation between Mean of Platts Singapore (MOPS) fuel grades and Brent Dated Benchmark Crude Source: Platts Asia-Pacific/Arab Gulf Marketscan Key observations Refiners Margin Observed refining margins (Figure 18) for Mogas has been climbing since late 2013, and overtook that of middle distillates in mid 2014, indicating that the supply demand balance in region has shifted and that Mogas demand is now supporting fuel prices. When this has happened previously in recent years (Sept 2011, March 2012, Jan 2013 and July 2013), it has been followed by a decrease in petroleum prices over the next months. 8. REGIONAL FUEL SPECIFICATIONS Key observations regional fuel specifications Mogas Most PICTs import 92 RON, however Cook Islands, French Polynesia, New Caledonia, Niue, Vanuatu and Wallis and Futuna import 95 RON, which has a higher cost than 92 RON. This goes some way to explain higher prices in those PICTs. Diesel There is a wide variation in ADO specification for land transport, ranging from 10 ppm Sulphur up to 500 ppm Sulphur. The trend is to go toward cleaner (i.e. lower sulphur) specs. Some electricity generators and moving in the opposite direction, back to 5,000 ppm Sulphur industrial diesel oil (IDO)and growing volumes of cheap, residual heavy fuel oil (HFO) imported. The high seas fishing fleet are maintaining their use of high sulphur marine diesel fuel (MDF) Kerosene (Jet A1, aviation turbine fuel, ADF) Standardised through out the region as dual purpose kerosene (DPK) Liquefied Petroleum Gas (LPG) Predominantly butane, with some propane and 50:50 blends. 13 P a g e

14 Table 1: Regional fuel specification summary Pacific Island country or territory Diesel fuel for land transport max sulphur (ppm) Diesel fuel for power generation max sulphur (ppm) Current fuel quality Petrol Research octane number (RON) Dual Purpose Kerosene (aviation & household) LP Gas American Samoa & DPK Butane Cook Islands DPK Propane Fiji 500 HSFO & DPK Butane French Polynesia 50 Marine Diesel Oil >2% sulphur 95 DPK Butane Guam 10 HSFO & DPK Butane Kiribati DPK Butane Republic of Marshall Islands DPK Propane Nauru DPK Propane New Caledonia 10 HSFO & DPK Butane Niue DPK Propane Palau DPK Butane Papua New Guinea DPK Butane Samoa DPK Propane Solomon Islands DPK Propane Tonga DPK Butane Tuvalu DPK Butane Vanuatu DPK Propane Wallis and Futuna DPK Butane 14 P a g e

15 Abbreviations 9. GLOSSARY and AND definition CONVERSIONS of key terms ADO automotive diesel oil or diesel fuel After tax price prices including tax and duty bbl barrel (of oil), approximately 159 litres Cpl cents per litre DPK dual purpose kerosene (i.e. jet fuel and domestic use) FOB free on board Gasoil refinery designation of diesel fuel produced by distillation HFO IDO kl Heavy Fuel Oil high or low sulphur residual fuel oils Industrial Diesel Oil often higher sulphur than ADO kilolitres (thousand litres) MDF Mogas Marine Diesel Fuel high sulphur diesel, often blended with residual fuel oils motor gasoline normally unleaded MOPS Mean of Platts Singapore MR Medium Range tankers, generally 20-40,000 metric tonnes Pacific- wide All surveyed Pacific Island countries (excluding Australia and New Zealand) ppm parts per million (10,000 ppm equals 1%) Retail price fuel price at retail/service stations, also called pump price Pre-Tax price price excluding tax and duty Pump price refer to retail price RON research octane number S Sulfur content (usually in diesel fuel) ULP unleaded petrol USD/bbl US dollars per barrel USD/l US dollars per litre Conversions Litres/USG Litres/BBL 159 USG/BBL P a g e

16 PICT fuel pricing methodologies Some PICTs including Samoa, Tonga, Papua New Guinea, Wallis and Futuna, New Caledonia, Vanuatu and Solomon Islands carry out price reviews on a monthly basis. Fiji reviews petroleum product price on a quarterly basis. Price change is based on MOPS prices of previous quarter. American Samoa reviews prices on fortnightly basis. In some PICs such as Niue and Cook Islands price change is carried out on an ad hoc basis. Price change is mostly influenced by either a major surge or fall in international market prices. In Kiribati there has been no price change for the last two years; even though international market prices of petroleum products have continued to increase. Price data sources Australian data is sourced from NZ data is sourced from Hawaii prices are calculated using US average refiners wholesale prices sourced from plus Hawaii taxes for diesel and Mogas which was sourced from Singapore data is sourced from Data for Saudi Aramco LPG prices was adapted from Figure 17 & 18 are generated using daily MOPS data sourced from Platts Asia-Pacific/Arab Gulf Marketscan. Prices for diesel, gasoline and jet/kerosene prices are provided by Platts (The McGraw-Hill Companies, Inc). Fuel volumes PICT volumes used in this report are based on 2009 annual market volumes as collected and published by SPC Economic Development Division. Graphs referring to fuel volumes plot the 1Q-2014 average prices against the 2009 annual volume demand for diesel and mogas for most of the PICTs. For American Samoa, French Polynesia, Palau and Wallis and Futuna, 2012 volume was used. For Guam, 2013 volume as published by the Guam Department of Energy was used but does not include volumes allocated for military use. The size of the ball in the volume weighted price graphs (figures 6 and 11) represents the annual total volume of all fuels within the PICT, which is an indicator of the import economies of scale available. (NB. PNG total volume includes refinery production). Volume for New Caledonia is projected using 1995 data and is an SPC estimate. Disclaimer The Secretariat of the Pacific Community has taken care in preparing these analyses. However, noting that the data in the analyses has been provided by third parties, SPC gives no guarantee as to its accuracy and reliability. For queries and clarifications please contact Ms Pritanshu Singh, Assistant Petroleum Officer. PritanshuS@spc.int 16 P a g e