Transport group seeks oil price freeze during calamities

MANILA, Philippines - A lawmaker is seeking the amendment of the Oil Deregulation Law to empower the Department of Energy (DOE) to freeze the prices of fuel and other petroleum products in areas placed under a state of calamity.

Rep. Vigor Mendoza III of 1 Utak transport coalition said under existing law, the DOE cannot adjust or freeze the price of petroleum products during calamities.

“The prices of fuel in the Philippines are directly affected by the price of oil in world market,” he said.

“Should international fuel prices increase at a time when the country is stricken by natural calamity, it would create a double burden on the part of Filipinos,” he said.

The bill seeks to retain the provision empowering the DOE to temporarily take over or direct the operation of any entity engaged in the industry, Mendoza said.

‘Unfair price hikes’

Industrialist Raul Concepcion is not convinced that the recent price hikes are “fair.”

Speaking to reporters yesterday, Concepcion said the oil firms and the DOE have not been transparent about the true costs of petroleum products.

“If the DOE and the oil companies were transparent then they must show their inventories and cost because even though the price of crude has gone up to $80, the increase should not be reflected immediately, or at least not until after 45 days,” he said.

Concepcion, Consumer and Oil Price Watch (COPW) chairman, said oil refiners like Petron Corp. and Pilipinas Shell carry crude stocks good for 45 days.

Up to now, it is not properly explained to the public why these oil refiners are using Mean of Platts Singapore (MOPS), the benchmark of oil importers, as their price gauge when they are obviously not importing all of their products, he added.

Concepcion said he would be glad to hear during the cross-examination of Energy Secretary Angelo Reyes at the Supreme Court why he is allowing these oil refiners to use MOPS in pricing their products instead of Dubai crude, a price barometer of refiners.

“They have to explain that (using MOPS as benchmark) to the public,” he said.

“The public must know why they are deviating from what should have been practiced by the refiners. I want to hear what Secretary Reyes would say about this.” – Perseus Echeminada, Rainier Allan Ronda, Donnabelle Gatdula