Reyes douses cold water on calls to regulate oil retailers

DESPITE mounting calls for regulation of the retail petroleum sector, Energy Secretary Angelo Reyes stood behind the law giving oil companies a free hand in setting fuel prices.In a statement, the Department of Energy (DOE) said Republic Act 8479, or the Downstream Oil Deregulation Act of 1998 is working for the country and that the law has created a healthy competitive environment in the industry in terms of “prices, quality of products and services, and more importantly, improved availability of access to supply.”

The said legislation was passed over a decade ago to help spur competition and remove government subsidies at the pump, which was then controlled l by the so called “Big 3” of Petron Corp., Pilipinas Shell Petroleum Corp. and Chevron (formerly Caltex) Philippines Inc.

The number of new oil companies outside of the three petroleum giants has since injected over P30 billion in investments in the retail sector, the DOE said.

The same law, however, clipped the powers of the government, with the DOE reduced to monitoring prices. Although the law seeks to prosecute cartel-like behavior, the government has yet to file a single case against any oil company despite their synchronized adjustment in fuel prices.

The department’s show of support for a free market in the retail fuel sector comes on the heels of various groups’ calls for government to step in and control prices.

The DOE also scored Raul Concepcion of the lobby group Consumer & Oil Price Watch (COPW) for his continuous attacks on oil firms and department officials in the print and broadcast media.

Concepcion has insisted that locally available fuel products are over priced and that the DOE has been lax in protecting the public interest.

Besides COPW, other consumer groups have also called on the DOE to open oil companies’ books to the public to help ascertain fuel prices.

Although the law requires oil companies to submit financial reports, this does not translate to requiring them to divulge such information to the public, the DOE, however, said.

“Chapter IV, Section 15 of the same law provides that all business information will be maintained in confidence and will be used only for official law enforcement purposes,” the agency said.–Euan Paulo C. Añonuevo, Reporter, Manila Times