Lower oil prices on international markets are already leading to a reduction in the cost of some fuels in Chile but exchange rate fluctuations and general market volatility are making longer-term projections difficult, energy minister Marcelo Tokman told journalists.
"We're already starting to see the price of gasoline and other refined products fall... and the price of natural gas is also starting to decline," Tokman said on the sidelines of an energy technology conference organized by Chile's national energy commission (CNE) in Santiago.
"Obviously, the decline in oil prices is very welcome, but we still can't make any new projections because of the level of uncertainty around the world," he said.
"One can make a hypothesis and the obvious one is that if the price of oil falls and the exchange rate [of the peso against the US dollar] does not increase, you'll see [energy prices] decline."
Referring to the recent announcement of node power price rises on both the northern SING and central SIC grids for regulated clients, Tokman said the main factor that led to the increases was the exchange rate.
"The other factors were pointing to lower prices," Tokman said. "We've had declines in power demand, growing supply and better hydro conditions. All of these factors point to lower power prices, but in the end it's the price of fuel and the price of fuel in pesos that determines the node price."
Node power prices on the SIC and SING grids are set to rise 13% and 15.5% respectively on November 1.
Revised biannually in April and October, the node price makes up 70% of the end-consumer's bill and is the price distributors pay generators.
The Chilean peso has fallen from below 450 to the US dollar in April to around 650 at present.
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