Traders refuse to answer question on oil price hike
DOE OIMB Director Zenaida Monsada meets lawyer Victor dela Serna in issues about fuel pricing. (PIABohol/RAC)
STILL smarting from alleged raking huge profits, big oil traders, including Petron/Chevron Philippines Inc., Shell and Caltex apparently refused to answer the question --- are you losing the business --- lodged by Atty. De la Serna.
They (big dealers) even denied they set up the so-called suggested retail price (SRP) per liter of petroleum products, such as regular and special gasoline and diesel which are most commonly used by the transport-consumers.
These were among the contentious and very sensitive issues tackled during the Consultation Forum on Oil Prices in Region 7 called and initiated by Gov. Edgar M. Chatto which was held at Bohol Tropics Resort Club last Friday afternoon in the wake of on-going soaring oil prices.
Mr. Toby Nebrida of the CPI, upon the assistance of Atty. Katrina Nicdao, invoked a certain law that they cannot “discuss oil pricing” in public apparently to evade on saying incriminatory statement.
Nebrida apparently avoided saying something on pricing that might be taken as refusal to answer De la Serna’s query: Are you losing in your business?
As to the question of who set up the pricing, particularly the SRP, Nebrida denied that his company or other oil companies do the pricing of oil in distribution aspect. But when De la Serna called up the attention of Mr. Vito Racho, who is retailer-distributor in the city, he said that it is not them (retailers) who set up the said pricing, but the companies.
This gave rise to more confusion to the public, De la Serna said. He said that if ever the big companies are losing then why there still are setting up more retail-outlets in the city or any other place like Cebu City.
De la Serna maintains that the big oil dealers still are into “extortionate” oil pricing or “price fixing” made by big oil companies. Earlier, De la Serna accused the retailers here of playing a cartel that is “monopolizing” the oil price in the province.
He also slammed on the DOE for doing nothing on the soaring of petroleum prices. He even proposed to abolish the DOE who are paid by the people’s taxes.
But Monsada retorted, “it’s unfair” for De la Serna’s accusation. She explained that what the DOE has done and still doing is to monitor on petroleum products sold in the market based on the deregulated law.
She explained in her power-point presentation that somehow the oil price hikes are subject to global market movements and even political tensions among oil producing countries.
She cited as an example that there are two bottlenecks why oil prices soar. One is that the tension in middleeast especially in the Hormuz Strait, wherein the country of Iran threatened to block the narrow sea channel of the Hormuz Strait. Iran and the USA are at odds since the former refused to abandon its nuclear program but the US wanted it scrapped because Iran is allegedly planning to make nuclear bombs.
Another bottleneck is at the Malacca Strait between Indonesia and Singapore and Malaysia peninsula, she said. In this very narrow sea channel where the oil tankers pass pirates are the threat, she said.
While expressing gratitude to the participants in the forum, Chatto said the dialogue served as venue to ventilate issues concerning oil supply and their prices. He said the forum may be a venue for some considerations or solutions, like the proposal to revisit the value-added tax imposed on petroleum products.
The dialogue was attended by key players of the oil industry, including independent player in FilOil represented by Mr. Mandy Ochoa, regional director Aster Caberte of the Department of Trade and Industry, director Zenaida Monsada of the Dept. of Energy (DOE), who presented the oil update and situationer; Atty. Jose Ma. Gastardo who represented Cebu Gov. Gwen Garcia; Provincial Legal Officer Atty. John Mitchel Boiser; board members Atty. Abeleon Damalerio and Dr. Cesar Tomas Lopez, consumers group represented by Ms. Meriatte Corales; business represented by Mayette Gasatan, other agencies and sectors and media. Governor Roel Degamo of Negros Oriental and Gov. Orlando Fua of Siquijor did not make it neither were they represented to the forum.
Based on the DOE presentation, Ubay has the lower price of diesel compared to Tagbilaran City. Diesel in Ubay is priced at PhP50.65/liter, lesser than PhP52.15 sold in the city. Almost all the dealers --- Petron, Chevron, Shell and Caltex --- have a uniform pricing as far as special gasoline is concerned at PhP62.95.
In separate interview with motorists, they said that still Ubay has the lowest prices compared to the city and other towns.
In Carmen town, the special gasoline is sold at PhP66.05/liter; regular, PhP62.90/liter; and diesel, PhP54.80/liter. In Talibon, special/premium is sold at phP64.80; regular, PhP61.25; and diesel, PhP53.05/liter.
Information gathered from Dumaguete City, Cagayan de Oro, which are very far from this city, revealed another scenario. All of the aforecited petroleum products are much lower than sold in Bohol generally.
Comparing Manila City, Cebu City and this city, the average disparity of oil prices is almost average at PhP2.00/liter.
Bohol has lesser number of gas stations with 54 with one depot with total capacity of 36 MB if compared to Negros Oriental with only 42 stations; two depots and 97 MB capacity.
Iloilo has 107 stations and 7 depots with 215 MB while Leyte 85 stations and 7 depots with 247 MB. Manila has 664 stations and 23 depots with 2,035 MB and Cebu City has 230 station and 11 depots with capacity of 805 MB, according to DOE.
Despite the fact that gasoline stations sprouted all over in the province, big players in the oil industry has still denied they are not making profits.
Nebrida told the forum that under the deregulation law, the companies do not make profits. It cannot guarantee profit margin. During the time when oil was regulated, the companies make profits, he added. (RVO)