RP hails OPEC move to hike output

Energy Secretary Vincent Perez Jr. lauded yesterday the decision by members of the Organization of Petroleum Exporting Countries to increase their respective production quota by an average of two million barrels per day beginning July 1, a move expected to cushion the impact of anticipated future increases in gasoline pump prices worldwide.

Perez said with the increased production, any increase in pump prices due to under recovery will be mitigated.

Perez previously led an informal caucus of non-oil producing countries in an effort to pressure OPEC to hike oil production quotas over a spate of increases which brought global oil prices to unprecedented highs.

OPEC decided to up quotas at a meeting in Beirut over the weekend, following initiatives by Saudi Arabia to call for increases in production levels.

Perez also bared that he had telephoned OPEC president Purnomo Yusgiantoro earlier during which he reportedly made clear the Philippine position that continued oil price hikes will hurt consumers worldwide. Perez said Purnomo "had committed to argue in favor of the Philippine position".

Perez also told Purnomo that the Philippines’ allies among non-oil producing countries have decided "that they will not stand idly by as an already volatile oil market is further ignited by current pricing practices". He added that it is crucial for OPEC countries "to respect the price band mechanism that OPEC itself helped establish to stabilize world oil prices".

At an earlier meeting of energy ministers in Amsterdam, Perez said an informal caucus of non-oil producing countries which include Japan, China, South Korea and India "are seriously looking into possible cooperation to mitigate the impact of current high oil prices".

Perez also hailed the move by Saudi Arabia to initiate moves towards increased production quotas among OPEC countries. He said Saudi Arabia "has given the global market a breather from the unfortunate sequence of events in the oil price arena".

Perez said that the "recent adverse trends in global oil prices has forced non-oil producing countries to map out moves that will reduce our vulnerability to the volatile nature of oil pricing practices".

In line with this, a major conference of energy ministers is slated to take place in Manila next week.

President Gloria Macapagal-Arroyo earlier directed Perez to "use economic diplomacy to help cushion the impact of rising oil prices and to help oil producing countries to understand that a volatile oil market does not benefit any economy, whether that of the First World or of developing countries.