No letup seen amid Ukraine crisis, P15 minimum jeepney fare pushed
Pump prices are expected to go up by P2 to P3 per liter next week, as a transport group petitioned the government for a 66 percent increase in the minimum jeepney fare, from the current P9 to P15.
Next week’s gasoline price hike will be the 10th consecutive weekly increase since January, and industry sources expect prices to go even higher amid Russia’s ongoing invasion of Ukraine.
Pump prices fell within the range of P70 to P80 per liter in Metro Manila, while in some provinces, gasoline prices reached closed P100 per liter.
Dubai crude, the benchmark for oil products in the Philippines, has gone up by $6.69 per barrel to $101.82 per barrel for the week of Feb. 28 to March 2 from $95.13 per barrel on Feb. 21 to 25. As of March 2, Dubai traded at $110 per barrel.
Energy Undersecretary Gerardo Erguiza Jr. said they plan to ask the oil companies to stagger the sharp increase, but said this would provide only temporary relief.
“If you delay that, the cost will be higher the next week,” Erguiza said.
He said President Rodrigo Duterte has engaged his Cabinet to speed the assistance to the sectors affected most by the oil price spikes due to Russia’s invasion of Ukraine.
This includes P2.5 billion “Pantawid Pasada Program” in the 2022 budget to ease the burden of the transport sector.The government is also providing P500 million worth of fuel discounts to farmers and fishermen through the Department of Agriculture.
Erguiza said the Department of Energy (DOE) is also monitoring reports of fuel stations allegedly selling petroleum products at nearly P100 per liter and will impose sanctions, if needed.
Meanwhile, Senator Sherwin Gatchalian, chairman of the Senate committee on energy, said he is open to reviewing the Oil Deregulation Law of 1998 “to improve transparency among industry players and assess the benefits to our consumers.”
The DOE has proposed amendments to the Oil Deregulation Law to compel oil companies to unbundle or detail what goes into the price per liter of fuel, set minimum inventory requirements and give the government powers to step in when there is a sharp rise or a prolonged increase in the prices of oil products.
“Considering that this is a 24 year-old law, the review can be helpful in optimizing the oil industry,” the senator said.
“However, a fundamental problem on why we are experiencing high prices of oil is because of our over dependence on improved oil. We import almost 100 percent of our oil requirements. As long as we import oil, we will be susceptible to global oil shocks that we have absolutely no control of,” Gatchalian said.
He renewed his call for more exploration of new domestic oil and gas reserves, and a transition to renewable energy as well as electric vehicles in the medium to long term.
Meanwhile, the Liga ng Transportasyon at Operators sa Pilipinas (LTOP) filed a petition with the Land Transportation Franchising and Regulatory Board (LTFRB) to increase the minimum fare in jeepneys to P15 as fuel prices continue to rise.
In its petition, the group said the rising costs of fuel and basic commodities meant that drivers of public utility jeeps can no longer provide their families three meals a day.
They asked for a “conservative fare increase” of the minimum fare to P15 for the first four kilometers.
LTOP president Orlando Marquez acknowledged that the fare increase would hurt commuters but said jeepney operators and drivers have to make a living.
Lawmakers on Thursday said Congress should tackle bills to suspend fuel taxes if it holds a special session to review the 1998 Oil Deregulation Law.
“I am for revisiting the law that deregulated the oil industry, but in terms of providing our people immediate and direct relief from soaring fuel prices, suspending taxes on oil products is considerably a better option,” said Anakalusugan Rep. Mike Defensor.
He said among Malacañang’s proposals in the review of the 1998 law is the building of oil reserves that can be drawn upon when world oil prices shoot up.
“I am for that. But how many years would that take? In the meantime, our people are clamoring for instant relief,” he said.
Reps. Carlos Zarate of Bayan Muna and Arlene Brosas of Gabriela urged Malacañang to certify as urgent a bill suspending the excise tax on oil products and called for a special session to deal with skyrocketing fuel prices.
Zarate, a House deputy minority leader, said Malacaņang should walk the talk by certifying as urgent a bill that will repeal or at the minimum review and amend the Oil Deregulation Law.
Brosas said the House committee on ways and means panel already approved the substitute bill in November last year. “Since Congress adjourned, the ball is on Malacanang’s court to call for a special session and certify the measure as urgent,” Brosas said.
To offset foreseen losses from oil excise tax suspension, Brosas added, the government must tighten regulation on oil imports and penalize oil smuggling, which causes billions in foregone revenues.
Earlier this week, President Duterte approved the recommendations of the DOE to implement a P3 billion subsidy program — the P2.5-B Pantawid Pasada, and P500 million fuel discount program for farmers and fishermen — as crude surged past $113 a barrel in the world market on fears of the economic fallout from the Russian invasion of Ukraine.
Duterte also called on Congress to review the Oil Deregulation Law amid the weekly increases in pump prices.