Why Qatar’s producer price (PPI) plunged 36.2% year-on-year? …maybe due to the lower oil prices.

Led by a double-digit decline in the prices for crude and natural gas as well as refined petroleum products, basic metals and basic chemicals, Qatar’s producer price index (PPI) plunged 36.2% year-on-year (y-o-y) in May 2015, according to official figures.
The PPI for the industrial sector – a measure of the average selling prices received by domestic producers for their output – however rose 3.2% compared to that in April this year on higher prices of crude, basic chemicals, refined petroleum products and man-made fibres. The latest figures were yesterday released by the Ministry of Development Planning and Statistics (MDPS).
The PPI for mining, which carries the maximum weight of 77%, reported a 40.3% plunge y-o-y in May 2015 due to a 40.3% decline in the prices of crude petroleum and natural gas; while stone, sand and clay prices firmed up 2.2%.
The mining sector PPI, however, saw a 3.4% surge in May month-on-month owing to a 3.4% rise in the price of crude petroleum and natural gas; even as stone, sand and clay prices fell 0.7%.
The Qatar Economic Outlook (QEO) for 2015-17 had said the slide in global oil prices had led to a fall in the PPI.
The manufacturing sector, which has a weight of 21% in the PPI basket, reported a 25.5% decline y-o-y in May 2015, explained by a 31% plunge in the price of refined petroleum goods, 19.7% in basic chemicals, 14.9% in basic metals and 0.1% in paper and paper products.
But there was a 6.9% increase in the price of dairy products, 5.9% in beverages, 5.3% in cement and other non-metallic products, 3.1% in juices, 1% in other chemical products, man-made fibres, 0.6% in rubber and plastic products and 0.5% in grain mill and other products.
The manufacturing sector PPI witnessed a 2.9% expansion compared with April this year on account of a 5.4% increase in the price of basic chemicals, 2.9% in refined petroleum products, 1.3% in other chemical products, man-made fibres, 0.4% in cement and other non-metallic products and 0.1% in grain mill and other products.
However, there was a 0.4% fall in the price of rubber and plastic products, 0.3% in basic metals, 0.2% in diary products and 0.1% each in juices and beverages.
MDPS, in its QEO 2015-17, said manufacturing, which is dominated by petrochemicals and refining industries that rely on oil and gas feedstock, also registered a “sizeable” decrease.
The electricity and water group, which has a 2% weight in the PPI basket, saw its index gain 2.3% y-o-y in May with water and electricity tariffs increasing 2.4% each.
The index was, however, down 0.7% against the previous month on 1.3% fall in electricity prices; even as water tariffs were up 0.1%.