Bill to scrap oil deregulation law filed anew

IN THE wake of surging oil prices, a lawmaker on Thursday filed House Bill 4317 or “An Act Repealing  Republic Act 8479, otherwise Known as An Act Deregulating the Downstream Oil Industry” to stop oil cartels’ profiteering-spree and exploitation of the Filipino people.

Anakpawis party-list Representative Rafael Mariano, in HB 4317’s explanatory note, said that “oil companies have abused the deregulation law for their ultimate objective of profiteering at the expense of consumers gruelling from the domino effect of excessive oil prices on basic goods, services, and utilities.”

“Oil companies amassed billions in profits over the years. In the Top 1000 Corporations in the Philippines 2009, Petron Corp. Placed first with recorded gross revenues of P268.8 billion in 2008, 26.2 percent higher year on year. Two other oil companies, Pilipinas Shell Petroleum Corp. (2nd) and Chevron Philippines, Inc. (5th) made it to the top five in the Top 1000 Corporations,” the bill stated.

Mariano said the cartel operations of “major oil companies Petron, Shell, and Chevron as well as new oil players consistently manipulated oil prices and overpriced oil products by using the fluctuating world crude oil prices and peso-dollar exchange as convenient excuse.”

“Today, the Big Three exploits the political unrest in the Middle East and North Africa as another convenient excuse to further squeeze profits from the Filipino people.  It’s a pity that the Aquino administration and the energy department appear helpless in the wake of surging oil prices,” Mariano said in a separate statement.

“And, while President Aquino declared openness in amending the Oil Deregulation Law, it was not included among the priority bills set by the LEDAC (Legislative-Executive Development Advisory Council),” he added.

The activist lawmaker stressed that “there are alternatives to the Downstream Oil Industry Deregulation Act and a concrete set of measures to implement them are available.”

Mariano cited a study entitled “No hope for fair prices under the deregulation” by Bagong Alyansang Makabayan research head Arnold Padilla stating that “while a buffer fund will be needed in a regime of regulated oil prices, such fund is entirely different from the flawed OPSF. It must be emphasized that it is possible to establish a buffer fund without passing on the burden to the taxpayers and consumers. One way of doing it is for the buffer fund to be financed by government earnings and savings from its increased participation in a regulated downstream oil industry.”

“Under this proposal, the government will become the exclusive importer of crude oil and petroleum products. As such, the country can expand potential oil sources and shop for the cheapest available oil. Bilateral agreements with state-owned companies from oil exporting countries may be pursued under special arrangements, including commodity swaps, which can provide the country considerable discounts,” HB 4317 cited Padilla.

Mariano said that the study further recommended that “the national government should also participate in storing, refining and retailing oil products in the country and use whatever earnings it will generate from these activities to finance the proposed buffer fund. Initially, the buffer fund can be financed through allocating a portion of the national budget and when unutilized within the fiscal year should be carried over to the next fiscal year.”

“Uncollected taxes from the oil companies, such as the P21 billion in unpaid custom duties of Shell, can also serve as seed money for the buffer fund,” he said.

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