MANILA, Philippines—Following the lead of the independent players, major oil firms Petron Corp., Pilipinas Shell Petroleum Corp. and Total (Philippines) Corp. announced they will slash prices of their liquefied petroleum gas by P4 a kilogram at midnight Tuesday.

Total also cut the price of its autoLPG, or LPG used as transport fuel, by P1.50 a liter last Monday.

During Tuesday’s oil industry stakeholders' meeting at the Department of Energy, Petron public affairs manager Virginia Ruivivar said the drop in the international contract price of LPG this month should result in an equivalent price reduction of P7.50 a kilogram.

"We expect to reflect this on a gradual basis. We'll try to do it as quickly as we can, but we can't do it at one time,'' she said, without explaining why.

According to DOE data, the international contract price of LPG fell to only $336.50 per metric ton this month from $490 in November.

Bulk LPG supplier Liquigaz Philippines Corp. and the LPG Marketers Association had cut prices of their products a day ahead of the three major oil firms, by P2 and P1 a kilogram, respectively.

With this price cut, an 11-kilogram LPG cylinder should now sell for between P396.40 and P463.40.

Energy Secretary Angelo Reyes said consumers could still expect more price reductions, not only for LPG and autoLPG, but also for gasoline, diesel and kerosene.

Flying V vice president Jose Victor Cruz said another P1-a-liter rollback was in the offing.

This would be on top of the reductions of P5 a liter for gasoline and P2 a liter for diesel that oil companies implemented last week.

However, the good news could end some time next year, he said, as pump prices might start going up then.

"Saudi Arabia earlier said international crude prices will hit $75 per barrel. At that point, an increase in prices could be expected early next year. This projection will translate to (a price of) P40-P42 per liter (for diesel),'' he said.

If this happens, he suggested that the Land Transportation Franchising and Regulatory Board consider making the mandated jeepney fare rollback provisional in nature, so that fares could go back to current levels when diesel pump prices start inching up again in 2009.

"And maybe we can do away with the hearings for fare adjustments,'' he said.

Efren De Luna, head of the Alliance of Concerned Transport Operators, said the Department of Transportation and Communications should consider issuing a department order that would allow public transport groups to adjust fares when certain diesel price "triggers'' are met.

For example, if diesel prices go up by a certain amount per liter, he said jeepney fares could also increase by a corresponding amount.