A weaker pa'anga and the new Foreign Exchange Levy have helped to significantly drive up the new prices for petrol, diesel and kerosene in Tonga for June to July, starting tomorrow Thursday, 16 June, the Competent Authority has announced.

The new retail prices, including consumption tax:

• Diesel 219.92 seniti per litre, 14.24 seniti increase
• Petrol 225.12 seniti per litre, 10.24 seniti increase
• Kerosene 153.06 seniti per litre, 12.62 seniti increase

The Competent Authority stated that, while the increase is mainly determined by the movement of FOB prices in the Singapore, "The higher Singapore prices combined with a weaker Tongan pa’anga, including the government introducing 0.5% exchange rate levy meant prices locally have increased significantly."

The FOB prices are based on last month’s average prices of the daily published Means of Platt’s Singapore (MOPS) benchmark prices.

Comparing the average prices of May with April, crude oil is up by USD 5.39 /bbl (13%) while kerosene and diesel prices are up by USD5.64/bbl and USD 6.77/bbl. Petrol prices rose, although less than crude because there is plentiful supply in the U.S ahead of its summer driving season (up by USD 4.52/bbl).

On the outlook, crude prices have stabilized just under USD 50/bbl in the first week of June. Crude oil prices are expected to remain relatively steady over the next quarter.

LPG prices drop

Meanwhile, the wholesale and retail prices for Liquefied Petroleum Gas in Tongatapu and Vava’u, (based on cargoes discharged before June) will drop starting on Thursday, 16 June.

The new prices for June to September 2016, for Tongatapu, the retail price for LP gas including consumption tax decreases by 0.18 seniti to a new price of $3.58 per kilogram.

For Vava’u, it drops by 0.29 seniti to a new price of $3.65 per kilogram.

The Competent Authority stated today this second quarter price change is based on the published Saudi Contract Price (Saudi CP) for the LPG cargoes discharged in March, April and May.

Tongatapu received four cargoes with one each in March and April and two in May. Vava’u had one cargo each in March and May this year.

On the outlook, LPG prices for the third quarter are expected to be flat until seasonal demand pulls prices higher in the fourth quarter.

The Northern Hemisphere LPG demand has diminished with the onset of summer (no LPG heating demand) and they expect third quarter prices to remain relatively steady.