Explain price hikes, oil firms told

Published by rudy Date posted on April 21, 2011

MANILA, Philippines–The Department of Energy (DoE) is asking oil companies that raised pump prices for the umpteenth time to explain why the latest round of increases was higher than computations showed.

The DoE pointed out that the price increases implemented beginning Tuesday were higher than its computations of 16 centavos per liter for diesel and 39 centavos for gasoline.

Letters had been sent to the companies that jacked up fuel prices above those levels, the DoE said.

Citing soaring global oil prices, Pilipinas Shell Petroleum Corp., Chevron (formerly Caltex) and Total Philippines the other day raised the prices of gasoline by 60 centavos per liter, of kerosene by 40 centavos a liter, and of diesel by 25 centavos per liter.

Petron Corp., the country’s largest oil refiner and retailer, did not increase the prices of its petroleum products.

Chevron rollback

A day after it raised prices, however, Chevron implemented a rollback, effectively canceling the oil price hike on Tuesday.

Chevron said it cut the prices of gasoline by 60 centavos a liter, kerosene by 40 centavos a liter, and diesel by 25 centavos a liter, effective noon Wednesday.

“Price adjustments are due to market forces,” it said, without providing any further details. No other companies made a similar move as of press time.

Energy Undersecretary Jose M. Layug Jr. said the unrest in oil-producing countries in the Middle East and North Africa and market fears of supply disruptions were pushing up fuel prices to near record levels.

Since the beginning of the year, local oil firms have raised fuel prices 13 times, adding up to a total increase of P10.20 a liter for gasoline and P10.10 a liter for diesel. Total reductions, on the other hand, remained marginal at only P1.75 a liter for gasoline and 25 centavos for diesel.

President Benigno Aquino III has asked the DoE to simplify its process of determining oil prices for the benefit of the public so the people could understand it.

“This will also show and demonstrate if the oil prices are right or wrong,” the President said.

Asked if he was amenable to the idea of oil firms opening their books, Mr. Aquino said this had been his position since entering public service.

Like Pilate

Two militant groups, however, likened the President to Pontius Pilate for his alleged neglect in addressing the people’s “long drawn-out demands” for “jobs, homes and justice.”

In a statement, Bagong Alyansang Makabayan (Bayan) and Kalipunan ng Damayang Mahihirap (Kadamay) lashed out at Mr. Aquino for his “inaction” in preventing oil price increases, including the jacking up of cooking gas prices by P1 per kilogram by retailers on Tuesday.

They noted that while the government “tolerates” the price increases of basic commodities, it “refuses” to grant the P125 across-the-board wage hike nationwide that workers have been pushing for.

Workers like Christ

“For the longest time, our Filipino workers (are) like Jesus Christ (who) carried His cross to Calvary … On the other hand, modern-day Pontius Pilate (P-Noy) and centurions (big businesses) continue to crucify and slash the backs of our working people in the form of meager wages, labor flexibilization schemes and inhumane working conditions,” Joy Lumawod, Kadamay-NCR chair, said.

Presidential spokesperson Edwin Lacierda said a task force made up of the DoE and the Department of Justice (DoJ) had been created to evaluate the response of the oil firms to the DoE request.

“(The DoE) wants to know the basis for increasing their prices,” Lacierda told reporters at a press briefing.

He noted that some oil firms did not increase prices like the others.

Lacierda said the DoE-DoJ task force would “evaluate abuse, if any.”

He said he did not know what liability the oil firms would have should it be proven that they erred in raising prices.

Lacierda reiterated that the DoE was in constant discussion with transport groups, oil firms and affected sectors so there would be transparency in the real market prices of oil.

Concepcion quiet

He noted that even consumer advocate Raul Concepcion had not been making any statements about the oil price increases because the DoE was “very open” about the oil prices.

Unioil, meanwhile, said it was giving away P50 worth of gasoline with purchases of P1,000 worth of petroleum products from any of its participating stations.

“Since the public is about to go on vacation we tried to ease the burden of the consumers by giving discounted prices for them to enjoy the holiday vacation,” Unioil said in a statement.

Kadamay and Bayan slammed the Aquino administration’s “washing-hands” approach to tackle “social injustices” that include unemployment, “homelessness” and low wages, issues which they said were the root causes of the “worsening hunger and poverty incidence” in the country.

They also criticized Aquino’s flagship policies that reportedly center on globalization and the “dictates of the US government,” such as private-public partnerships, deregulation, contractualization schemes, and dependence on exports. With a report from Kristine Felisse Mangunay –Christine Avendaño, Amy R. Remo, Philippine Daily Inquirer

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