The prices for petrol, diesel and kerosene in Tonga will decrease for August to September starting on Monday, 17 August.

The new retail prices including consumption tax are:

Diesel 236.75 seniti per litre, 11.75 seniti decease

Petrol 253.29 seniti per litre, -8.9 seniti decrease

Kerosene 167.67 seniti per litre, 10.41 seniti decease

The Competent Authority in approving the new prices stated it was mainly determined by the movement of FOB prices in the Singapore market based on July 2015 average prices of the daily published Means of Platt’s Singapore (MOPS) benchmark prices.

Comparing July’s average prices with June, crude oil (Dated Brent) is down by USD5.15/bbl (8.3%). All product prices fell more than crude as the refining margins reduced.

Diesel recorded the highest drop of USD9.66/bbl (12.9%) while petrol and kerosene prices fell by USD8.50/bbl and USD8.75/bbl respectively. The freight rate had also strengthened with improvement in the shipping market as a result of higher demand for products.

Meanwhile, the Tongan pa’anga has continued to depreciate, falling to a monthly average of USD45.75 cents. The reduced exchange rate and higher freight had partially offset some of the decrease in international prices for local consumers.

On the outlook, with the Iranian supply expected to increase next year and no signs of other OPEC members reducing their production, many international companies are now predicting crude oil prices will be lower for a longer period.

Demand for product, particularly petrol remains strong although not sufficient to increase prices.