Nograles: P1/liter rollback is not enough

PHILIPPINE NEWS SERVICE — SPEAKER Prospero C. Nograles yesterday said Filipinos are still getting the short end of stick even with the P1 per liter oil price rollback, insisting that the cut in pump prices of both diesel and gasoline should not be lower than P7 per liter as the price of crude oil in the world market has gone down to an average of $67-$70 per barrel.

Nograles added that he is puzzled why small players in the oil industry can afford higher price cuts if compared with the so-called Big Three which have their own oil fields and refineries.

“The trend of oil prices in the Philippines is a world turned upside down. Here you have small oil distributors who don’t even have their own oil fields and refineries who can afford to cut their prices by as much as P2 per liter and you have these big multi-nationals who can only give us P1 price cut per liter,” Nograles said.

“It’s too obvious that we are getting the short end of the stick here. The P1 rollback is not enough considering that world market prices now is more than 50% lower than its July level of $132 per barrel where the pump prices are at its historical peak P60.46 per liter for gasoline and P60.02 per liter for diesel,” Nograles said.

Nograles said that considering all other factors such as taxes and other extraordinary expenses that are normally passed down to the consumers, pump prices should still be at the level of P41-P42 per liter for both diesel and gasoline, or even lower because of the improving exchange rate of the Philippine peso over the American dollar.

As of yesterday, the exchange rate is at P48.65 to a dollar which is over P1 higher than its previous rate.

“If we talk about proportionate rollback, the average local pump price for gasoline and diesel should now be at P30 per liter and even if we take into account all other factors such as the E-VAT and other taxes and extraordinary expenses, the average price should still be at P41-P42 per liter and not P46 or P47 per liter,” he said, as he noted that some small oil players have reduced their prices from P48 to P46 per liter for nearly a week now.

Nograles said that the House of Representatives, through the house committee on energy chaired by presidential son Juan Miguel “Mikey” Arroyo, will proceed to investigate the profits of the country’s oil firms even with the P1 per liter rollback as he pointed out that the oil deregulation law should not be used as a tool to shortchange Filipino consumers.

“The concept of oil deregulation was to ensure a truly competitive market and a regime of fair prices, adequate and continuous supply of environmentally- clean and high-quality petroleum products. What we are seeing however is just the opposite. I think that it’s about time that Congress should look into the profits of these oil firms and find out if they are complying with the spirit and intent of the oil deregulation law,” he said.

Nograles noted that even at P47 per liter, inclusive of the P1 rollback, it’s still higher by P3 per liter for gasoline and almost P9 per liter for diesel. In January, the price of crude was at $87.19 per barrel at an exchange rate of P40.94 to a dollar and the pump price of gasoline was P44.45 per liter and diesel was P38.45 per liter.

“The pricing discrepancy is just too big and absolutely unreasonable. We deserve more price reduction,” he said.