Almendras: Brace yourselves for higher gas prices

THE public must brace for higher oil prices that could go beyond $100 a barrel, Energy Secretary Jose Rene Almendras said Wednesday.

“We have to face reality that a $100-per-barrel [oil] will happen,” he said.

“All the world is in the direction of preparing for such reality. We have to accept the reality that oil is a finite resource. We have to look for alternate energy sources.”

Almendras made the statement even as gas stations in Metro Manila started limiting the amount of fuel motorists may buy following the shutdown of a leaking pipeline that delivers gasoline, diesel and kerosene to Pandacan in Manila from Batangas.

Other stations have either cut shifts or planned to open only five to six days a week as a result of the limited diesel and gas on stock.

The Energy Department said it wanted to do more tests on Philippine Industrial Corp.’s pipeline before it could recommend its reopening.

“What we have asked [the company] to do … is to conduct a bore-hole test and a segmented pressure test to make sure the pipeline is safe to operate again,” newly appointed Energy Undersecretary Jay Layug said.

Almendras said the recent P2 per liter increase in the price of diesel and kerosene and the P1.50 per liter adjustment in the price of unleaded gasoline were within his department’s “computed values.”

The department included in its computation the peso’s weakening to 43.44 to the dollar from 42.73 the previous week.

“Earlier, I explained that what worries me is the fact that [the price of] diesel went up twice that of crude and all the other products,” Almendras said.

“We did inquire from the international market why such a situation occurred, and the explanation is a significant draw-down in diesel inventories, and they’re pointing to China.” –Alena Mae S. Flores, Manila Standard Today