‘Consumer prices should go down with fuel price drop’

MANILA, Philippines - The Department of Trade and Industry (DTI) is calling on producers of basic necessities and prime commodities to reduce prices amid the decline in transportation costs and oil prices.

Trade Secretary Gregory Domingo said in a statement yesterday that Filipino consumers should also benefit from the continuous fall of world oil prices, which have gone down by 30 percent since June this year.

“We are calling on producers and distributors to share with the public the savings they are realizing as a result of the lower cost of transportation and energy, particularly on agricultural products and basic consumer goods,” he said.

“This would be a timely and much needed service to Filipino consumers especially with Christmas just around the corner,” he added.

The trade official has instructed the DTI’s Consumer Protection Group to determine how much should be
 deducted from the suggested retail price of basic necessities and prime commodities which cover agricultural and non-agricultural products given lower transport and energy costs.

“We are going over our data to check how the price drop should be reflected on the prices of basic and prime goods. The steady decline of oil prices should now have a significant impact on the prices of all products and services. At the minimum, they should decrease by 3 percent,” Domingo said.

Based on the decline in oil prices, the DTI said the following price reductions should apply:

- 22 centavos for 155-gram can of sardines;

- 95 centavos for a 370-milliliter can of evaporated milk;

- 99 centavos for a 50-gram coffee refill; and

- P25.91 for a 25-kilogram sack of flour.

During its meeting held in Austria last week, the Organization of Petroleum Exporting Countries (OPEC) decided not to cut output and to maintain production at 30 million barrels per day as first agreed in December 2011.

Following the meeting, the price of the benchmark Brent crude fell below $72 a barrel, its lowest since August 2010, before settling at $72.82.

The decline in oil prices is expected to continue in the coming months.

The DTI said it would coordinate with other members of the National Price Coordinating Council such as the departments of agriculture, energy and health to look into the impact of the falling prices of world crude oil on products and services.

The DTI said it also wants other government agencies such as the Land Transportation Franchising and Regulatory Board, Civil Aeronautics Board, Maritime Industry Authority, and the Energy Regulatory Commission, to assess the impact of the falling world oil prices on trucking and shipping rates, land transportation fare, fuel surcharges, and electricity rates.

Citing records from the Department of Energy, the average pump price of diesel fell about 20 percent to P36.71 per liter this month from P44.63 per liter in January.

The average household liquefied petroleum gas (LPG) price also slipped by about 25 percent to P34.54 per kilogram from P45.36 per kilogram over the same period.