Philippine Oil Pump Price Calculation Model and Oil Company Gross Margin – Annexes

September 13th, 2012 No Comments   Posted in Oil Pricing Formula

Philippine Oil Pump Price Calculation Model and Oil Company Gross Margin – Annexes

The last part of this 3-part series presents the results of applying the oil pump price calculation model into the 1974-June 2012 historical data on pump price, import costs, taxes and government imposts, logistical and transport costs, biofuels, and dealer margin. More »

Philippine Oil Pump Price Calculation Model and Oil Company Gross Margin – Analysis and Conclusions

September 12th, 2012 8 Comments   Posted in Oil Pricing Formula

Philippine Oil Pump Price Calculation Model and Oil Company Gross Margin – Analysis and Conclusions

 

Analysis and Conclusions

 

This chapter presents the evolution and derivation of the oil pump price formula. There is a need to develop an oil pump price formula simply because the oil companies never divulge their oil company gross margin which is the residual or price difference when we subtract from the actual pump price all the importation value adding activities such as supply cost or FOB/MOPS/Dubai, ocean freight and insurance, customs duty, BOC fee, import processing fee, customs doc stamps, bank charge, arrastre charge, wharfage charge, and excise tax or specific tax to arrive at the 12% VAT on all importation activities, and all local value adding activities such as oil company gross margin, transshipment, pipeline, depot operation, biofuels, hauler’s fee and dealer’s margin to arrive at the 12% VAT on local activities. More »

Philippine Oil Pump Price Calculation Model and Oil Company Gross Margin – Introduction

September 12th, 2012 2 Comments   Posted in Oil Pricing Formula

Philippine Oil Pump Price Calculation Model and Oil Company Gross Margin – Introduction

Introduction

This technical paper will present the various oil pump price calculation model (regulated and de-regulated periods) which together with the supply cost, end pump price, taxes (customs duty, special duty or Estanislao Peso, excise tax or specific tax, value added tax or VAT), biofuels (10% ETHANOL gasoline blend and 2% CME BIODIESEL blend), logistical costs (transshipment, pipeline, depot operation, hauling fee), and dealer’s margin will be subsequently used to calculate the residual component (by difference) that goes to the oil company (refiner, importer/marketer). More »

Philippine Oil Pump Price Calculation Model and Oil Company Gross Margin – Executive Summary

September 11th, 2012 No Comments   Posted in Oil Pricing Formula

Philippine Oil Pump Price Calculation Model and Oil Company Gross Margin – Executive Summary

 An Independent Oil Price Review Committee (IOPRC) recently completed its study and submitted its findings to the Philippine Department of Energy (DOE), the print and broadcast media, and conducted a public consultation at the UP School of Economics to interested parties such as NGOs, oil company associations, academe.

The IOPRC concluded that domestic oil prices of gasoline and diesel tracked changes in the international price of oil (Mean of Platts Singapore or MOPS) based on statistical and regression analysis. It also found that the return on equity (ROE) and internal rate of return (IRR) of the oil companies (refiners, importers) on an annual average are reasonable and lower when compared to returns of other utilities and industries such as power generation, telecom, mining and that the oil company gross margin (in % and absolute Pesos per Liter) which was computed by subtracting from the pump price all taxes and government fees, logistical costs, dealers margin and cost of the imported oil were not excessive as generally alleged. More »

Estimating impact of transport fuel price increase on passenger tariff fares

March 9th, 2012 No Comments   Posted in public transport fare

Estimating impact of transport fuel price increase on passenger tariff fares

It is possible to develop a business model for each mode of transport and determine the fare (Peso per passenger km) that will allow the public transport investor a fair return on his investment given his vehicle size/capacity (passengers per trip), capacity factor (% seats occupied), travel distance per round trip, time for a round trip (hours per round trip), number of trips in a day (week days and week ends), number of operating days per year, fuel mileage (km per liter), cost of fuel (Pesos per liter), fixed operating costs (boundary, permits, fees, licenses), variable maintenance costs other than fuel (tire, radiator, brake, engine, suspension, body works), other variable operating costs (toll fees per round trip). More »