Belmonte urged to reconsider anew repeal of Oil Deregulation Law

Published by rudy Date posted on May 2, 2011

Lawmakers yesterday renewed their call for House Speaker Feliciano Belmonte to reconsider his position not to repeal or amend Republic Act (RA) No. 8479 or the Oil Deregulation Law (Downstream Oil Industry Deregulation Act of 1998).

Bayan Muna Rep. Neri Colmenares and Quezon City Rep. Winnie “Winston” Castelo said that Belmonte should reconsider his stand in opposing amendments to the law. They said that the unabated spike in the prices of petroleum products has triggered high prices of basic commodities.

“I hope the Speaker would change his mind and support all moves to repeal the Oil Deregulation Law because this is what the people need now in light of the serious problems besetting the nation,” Colmenares said .

Castelo, for his part, said that repealing the law is the only way by which the government could lower oil prices.

“Unless we repeal the Oil Deregulation Law, major players could always argue pegging their prices against prevailing market forces,” Castelo said.

He said that the Oil Deregulation Law has failed to create a competitive market that would trigger lower oil prices.

“As of now, we are at the mercy of the three big oil cartels in pegging prices of crude oil,” Castelo said.

Belmonte maintained that the situation is temporary and would stabilize once the conflict in the oil-producing countries stop.

“Scrapping it or changing it from deregulation to regulation is very something that requires a lot of talks and my own personal view is, I am not in favor of it. Pero sa tingin ko we have to try to take measures to alleviate these situations which I think are temporary situations. I think we went through a long process of finally deregulating the industry and that was the right move,” Belmonte told reporters.

“Little amendments lang. We had something like this in the past and we can see that they were not permanent so I think the fundamentals are still there. Nagkataon lang that you have all these things happening (political upheaval) on oil producing countries,” Belmonte added.

This developed as Cavite Rep. Elpidio Barzaga said that the Department of Energy (DoE) and the Department of Justice (DoJ) have ample powers to suppress possible pricing abuses by oil industry players.

“The Downstream Oil Industry Deregulation Law of 1998, or Republic Act 8479 did not render the DoE and the DoJ toothless in protecting consumers against any excessive and unwarranted increases in the prices of petroleum products,” Barzaga said.

He said the DoE-DoJ Task Force under the law was installed precisely to enable regulators to rein in potential price gouging and other unfair trade practices by the oil firms.

“In fact, we have an entire chapter in the law devoted to anti-trust safeguards, prohibited acts, and remedies. We also have another chapter granting the Secretary of Energy additional surveillance and enforcement powers to ensure a competitive free market and fair pricing,” Barzaga said.

In particular, Barzaga cited Section 14 (d) of the law, which mandates the DoE-DoJ Task Force to investigate on its own, even without any complaint, any unreasonable rise in the prices of petroleum products and/or file the necessary legal action with the proper court or agency.

He said that under the law, the DoE-DoJ Task Force is also duty-bound to act within 30 days on any report from any person of an unreasonable rise in pump prices.

He likewise cited Section 15 (b), which empowers the Secretary of Energy to order any person and require the latter to file reports or respond to specific questions, under oath, on any matter the Secretary may want regarding the oil industry. –Gerry Baldo, Daily Tribune

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