Lawmaker to oil companies: Oil price rollback is still not enough

PARTYLIST Rep. Teddy Casiño today said that recent oil price rollbacks are still not enough considering that as of March 2012, the price of diesel is overpriced by as much as P7.86 per liter and gasoline by P16.18 per liter.

Citing data from a recent study by the Bagong Alyansang Makabayan, Casiño said since the oil industry was deregulated in 1999, the upward movement of local oil prices were quick and often exceeded the movements in global oil prices and foreign exchange. In contrast, the downward movement was slow and often small in proportion to the decrease in global oil prices and foreign exchange.

“Even if fuel prices in the country have been going down since April it is still not enough. Diesel rolled back 9 times or a total of P6.55 per liter. Gasoline prices likewise have gone down 9 times or a total of P5.45 per liter. Kulang pa din talaga at dapat e mamaintain na ang downward trend ng presyo ng langis, pero with deregulation malabong mangyari yun,” said Casiño.

“Ganun pa din kasi e, mabilis at sobra kung tumaas, mabagal at kulang pag bumaba. As for a fare rollback we have to see if this can be maintained and fixed to prices below P40 so that drivers and commuters would have a fair deal,” Casiño described the movement of local oil prices.

“We can ensure that prices stay down in the short term though by cutting the value added tax (VAT) on oil and for the long run of course is the deregulation of the oil industry,” he added.

Casiño revealed last month that the oil industry is under a scheme of multiple overpricing, from January 1999 to March 2012, local oil companies have been able to accumulate an overprice of as much as P7.86 per liter for diesel and P16.18 for gasoline. With the latest roll back now oil companies should still roll back at least P1.31 on diesel prices and P10.73 in regular gasoline prices. “In other words, bitin pa din ang mga roll back na ito,” he said.

The study was based on the monthly movement of Dubai crude and foreign exchange (forex) rate  based on a rule of thumb used by one major oil firm that pegged the movement of local prices at around P1/ liter for every dollar change per barrel of oil and around P.30/liter per peso change in the forex.

“Malinaw dito na ginigisa tayo sa sarili nating mantika ng mga oil companies at dapat itong makita at solusyunan ng pamahalaan. In 2010 alone, Petron raked in P7.92 billion in profits;  Shell, P16.5 billion; Chevron, P3.9 billion; and Total, P1.03 billion. Though already in the billions, these declared profits are still small because they do not include the local overpricing earlier mentioned. We want the Independent Oil Price Review Committee (IOPRC) to expedite their work and look into this immediately,” concluded Casiño.

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