Some jeepney drivers plan to stop plying their routes next week as pump prices rise for the 11th straight week, a transport group said Sunday.
In an interview on radio dzBB, 1-UTAK chair Atty. Vigor Mendoza II said commuters can expect fewer jeepneys in various routes nationwide by Tuesday or Wednesday.
“There will really be drivers who still stop operating. It’s not that they’re protesting or anything but they really don’t make money anymore,” he said in Filipino.
He said with the expected P12 per liter increase in diesel, drivers would have nothing to bring home.
In its fuel price forecast for March 15 to 21, Unioil Petroleum Philippines said the price per liter of diesel could shoot up by P12.20 to P12.30.
Gasoline prices, meanwhile, are expected to rise by between P6.80 and P7.00 per liter.
Pinagkaisang Samahan ng mga Tsuper at Operator Nationwide (PISTON) national president Mody Floranda on Sunday said the price shock would hurt drivers.
In an interview also over radio dzBB, he asked why fuel prices rose weekly when the oil companies do not import petroleum every week. If the oil companies maintain a 30-day stock, why does the government allow them to increase prices weekly, he asked.
The Senate committee on energy will hold a hearing today (Monday, March 14) to ask the Department of Energy (DOE) and other agencies what they plan to do to mitigate the skyrocketing oil prices.
Over the weekend, Unioil Petroleum Philippines announced an unprecedented oil price hike of P12.20 to P12.30 per liter for diesel and P6.80 to P7 per liter for gasoline due to the Russian invasion of Ukraine.
The high pump prices will take effect on Tuesday and the oil companies have not announced whether they will implement it on a staggered basis.
The Senate committee on energy led by chairman Senator Sherwin Gatchalian has invited the oil companies and other government agencies to the hearing, which will begin at 11a.m.
Also expected to attend are representatives from the power sector to discuss the impact of the high prices on electricity rates.
Gatchalian said last week the Philippines will have to “brace for the worst” as oil prices continue to soar due to uncertainties brought about by Russia’s war in Ukraine.
“Nobody knows, we don’t have a crystal ball that can predict when this crisis will end and as long as there’s uncertainty, prices of oil and gas will go up, that’s certain,” Gatchalian said in an interview at CNN.
“We’ve seen that in the past oil crises. We’ve seen that last year when the global economy opened, and with this uncertainty, we have to brace for the worst. Oiil prices might even reach $150 per barrel if this uncertainty persists,” Gatchalian said.
He said some analysts forecast the price of oil could reach $200 per barrel, but even more than the price, the Philippines will need to focus on energy security.
“We have to also think of the worst when it comes to supply because in our policy, companies are mandated to store 30 days of inventory… I’m actually proposing to increase the minimum oil inventory to 45 days… and the government [can] subsidize the carrying cost because when these companies buy another 15 days, they have to pay for interest,” he said.
He said the latest pronouncement of the US and the UK not purchasing Russian oil will have an impact on supply.
“That will have a tremendous impact because, where will the UK source their oil?” he said.
He noted that oil prices have gone up by an average of 20 percent from 30 days ago.
Gatchalian said he is open to suspending excise tax only “as a last resort” and only if the high oil prices continue over three months as it will take away about P90 billion from government coffers.
“If you juxtapose that with Pantawid Pasada, Pantawid Pasada is only P5 billion. So giving out P5 billion versus taking away P90 billion is a big difference. But that should be the last resort,” he said.
Gatchalian said the Philippines has not discovered any major oil discovery since the Malampaya gas to power project.
“We need to be more aggressive and we need to roll out the red carpet to investors because our regime is a deregulated regime, meaning private investments are welcome but we need to make it easier for them,” he said.
He said the country is also heavily dependent on foreign oil, which means 100 percent of its gasoline and diesel is supplied from abroad.
“We import 100, almost 10 percent of our coal and that’s 50 percent of our energy mix. So in other words throughout the years, we have relied so heavily on imported materials, and that makes us very susceptible to price shocks,” he said.
To cushion the impact to the transport sector, Gatchalian said the government is implementing the Pantawid Pasada program, which could take 60 days.
“We have to also institutionalize a shock absorbing mechanism and this is the Pantawid Pasada, making sure that whenever there is an abrupt increase in prices, we can remit the cash to our drivers immediately. Instantaneously if we can,” he said.
He said the government needs to overcome the red tape and bureaucracy and use modern technology to immediately disburse funding to affected sectors.