Analysts said they do not expect local refiners to be able to fully recover their import costs soon because of growing public opposition to rising prices.

The department of energy said in a report the FOB price of Dubai crude jumped by more than 100 per cent to an average of $21.90 per barrel in September from an average of $10.72 in January because of production cuts by major producing countries.

The peso averaged 40.23 to the dollar last month from 38.44 at the start of the year, the report said.

In contrast, local fuel prices have increased by only 25 to 30 per cent in the first nine months, data from Petron Corp and Caltex (Phils) Inc said.

Local firms bought crude oil at an average of $12.13 per barrel last year, and $18.86 in 1997. The peso deteriorated to an average 40.89 to the dollar last year due to the Asian crisis from around the 26 level before July 1997.

``There is pressure to pass on as much as possible the increase in crude costs to the market place,'' Caltex president Frank Cruz told Reuters.

The under-recovery is ``pressurising the bottomline and the cash flow of oil companies,'' he said.

``We are going to report a significant loss in the third quarter,'' Cruz said, adding he expected the 1999 net income of Caltex Philippines to be lower than last year's profit of 1.3 billion pesos.

Research head at Orion Squire Capital Inc Cilette Liboro said she expected Petron to post a lower net income of 3.3 billion pesos from the year ago 3.7 billion.

Another stock analyst who requested not to be identified said: ``I've been recommending to clients not to buy Petron because of its under-recoveries.''

Petron said local refiners need to increase product prices by an average of 27 centavos per litre for every one dollar rise in the price of crude. Every peso depreciation in the exchange rate will translate to an increase of 14 centavos per litre in local prices, it added.

Cruz said he expected Dubai crude to stay at the current $22-$23 per barrel level or higher for the rest of the year ``if the Y2K related issues will result in a building up of inventory of oil companies.''

Y2K, or the millennium bug, refers to computer programing convention that reads only the last two digits of the year. The year 2000 might therefore be read as 1900, possibly causing a breakdown in date-sensitive computer systems.

The Philippines has three main oil refiners - Petron, Caltex and Pilipinas Shell Petroleum Corp.

Caltex is a unit of the joint venture between Chevron Corp and Texaco Inc while Pilipinas Shell is a member of the Royal Dutch/Shell group of companies.