* Economy expected to grow 5-6 percent in 2012
* Car import sales surge 38 percent in Q1
* Expansion of retail outlets spurs diesel, gasoline imports
By Jessica Jaganathan
SINGAPORE, April 26 (Reuters) - Diesel and gasoline imports into the Philippines are expected to rise by at least 20 percent this year as the country’s economic growth is set to accelerate, spurring fuel station operators to expand rapidly, industry sources said.
The Philippine economy grew slightly faster than expected in the last quarter of 2011, with the government optimistic that growth will pick up further this year to between 5 and 6 percent, from 3.7 percent for 2011.
The better economic outlook pushed imported car sales up by 38 percent in the first quarter compared with the same period last year, the country’s Association of Vehicle Importers and Distributors said earlier this week.
This in turn is driving national oil companies and independent operators in the country to compete for the biggest market share in the retail oil network. Their massive expansion plans are causing a spike in oil product imports for this year, traders said.
“It’s all demand driven so companies are acquiring more and building more retail stations,” said a trader based in the Philippines. “The outskirts of the country has not been fully explored, so a lot of the expansion can be seen there.”
The latest official government import statistics are not available, but Seaoil Philippines, the country’s largest independent fuel company, has more than doubled its term imports of oil products to 200,000 barrels a month this year - half diesel and half gasoline.
It imported about 80,000 to 85,000 barrels a month of oil products for its term last year, a source familiar with the matter said.
The company is expected to enter the spot market soon to purchase additional barrels to cater to the increase in demand from the expansion of its retail outlets, the source added.
Seaoil Philippines plans to add 100 retail stations by the end of this year to the over 200 stations it currently operates.
The Philippines’ biggest oil refiner, Petron Corp, is expected to import about 20 to 30 percent more diesel over January to June this year compared with last year, a second source said. Exact volumes, however, are not known.
It plans to add 500 retail stations by the end of next year to its current 1,800 stations, the source added.
Publicly listed independent oil firm Phoenix Petroleum Philippines plans to open an additional 80 retail stations by this year to add to its existing 240 stations, a company source said.
Other top oil fuel pump station operators in the country like Chevron and Shell are also investing heavily to expand over the next five years.
But the expected spike in diesel and gasoline imports could also be due to a shortfall in refining capacity in the country, said Hun Sung Yen, a consultant with FACTS Global Energy.
“The wild card could likely be the drop in refinery run rates, rather than a spike in demand itself,” he said.
The increase in diesel imports is expected to push premiums up for the 500 ppm sulphur diesel that the country uses, traders said.
Premiums for the grade have already surged 28 percent to over $2 a barrel on Wednesday, from two months ago, Reuters data showed. (Reporting by Jessica Jaganathan; Editing by Chris Gallagher)