Philippine consumers use app to counter record retail fuel prices
MANILA (Reuters) – Philippine motorbike fanatic John Aldwin Bagabagon rode simpler than many different native motorcyclists and drivers this yr as home gas costs surged to file ranges.
Bagabagon, 35, and his household are amongst 200,000 shoppers turning to a homegrown app to safe credit for bulk gas provides at low costs, saving about 50% on their gasoline purchases over the previous 4 months.
“I save so much particularly now that gasoline costs are rising weekly,” Bagabagon mentioned.
The app PriceLOCQ permits customers to replenish on gas at a set value by changing purchases to digital credit which might be later redeemed at SEAOIL Philippines petrol stations.
Mark Yu, who launched the PriceLOCQ app in 2020 and whose household owns impartial gas firm SEAOIL, says use of the app has “skyrocketed” since costs began rising this yr, particularly after Russia’s invasion of Ukraine disrupted world oil markets.
Gasoline gross sales by way of the app in a single day in mid-March hit 2 million litres, matching volumes for the complete month of February as shoppers scrambled to get forward of value spikes.
Half of PriceLOCQ’s purchasers are new clients of SEAOIL, which has round 6% of the retail gas market, mentioned Yu, who can be the chief monetary officer of SEAOIL.
PriceLOCQ is the one app of its form within the area, Yu mentioned. Yu’s private enterprise, LOCQ, is behind it, and companions with hedging companies to offset the dangers amid unstable costs.
The Philippines imports greater than 90% of its annual gas necessities. Pump costs in capital metropolis Manila, an city sprawl house to 13 million individuals, have risen by 30% for gasoline and 66% for diesel this yr, authorities information reveals. Gasoline hit a file of 81.85 pesos ($1.56) per litre in mid-March 2022.
Early adopters of PriceLOCQ have been in a position in 2020 to buy as much as 600 litres (158.5 gallons) of gasoline and diesel merchandise for future refuelling at round 20 pesos per litre. Costs now are round 79 pesos per litre.
Whereas locking in costs in a rising market is attractive, shoppers are suggested to not hoard gasoline and purchase in line with their wants, mentioned Bernard Flores, a Manila-based monetary guide for Pru Life UK.
Authorities have additionally warned clients to grasp the underlying dangers of utilizing the app, together with the non-transferability of the credit and the hazard of shopping for bulk gas and seeing costs fall.
“It’s just like the inventory market the place you discover the specified value you favor and also you lock in on it. No matter occurs, whether or not the costs go up or down, you’re locked in,” Flores mentioned.
Many motorists remained undeterred, although, particularly these on the roads as a part of their job.
“If this app did not exist, we might have a tough time as a result of … we use gasoline on daily basis,” supply employee Johnrey Omolon mentioned.
“It is an enormous assist. We get to arrange (for modifications) each time gasoline costs improve.”
($1 = 52.33 Philippine pesos)
(Reporting by Neil Jerome Morales and Adrian Portugal; Enhancing by Kanupriya Kapoor and Tom Hogue)
