Lawmakers, government officials, and representatives from the big oil players are meeting today to consider ways to cushion consumers from oil price shocks, Speaker Ferdinand Martin Romualdez said Sunday.
“No one is spared from the ill effects of the high cost of living due to oil price hikes. Everyone is struggling. But this is beyond anyone’s control. If the price of crude oil in the world market increases, so do prices in the rest of the world,” Romualdez said.
“But we want to sit down with these oil companies and discuss ways or suggestions on how we can alleviate the hardships of our countrymen due to the constant rise in petroleum prices, and find common ground in areas that are within our control,” he added.
The solution can come from a united front of all stakeholders, the oil companies and the government, he said.
“On our part in the government, we can compromise… Perhaps what we can initially offer is a possible review of excise tax or the value-added tax on oil and petroleum products. This is a good place to start,” he said.
“Also, one possibility to look at is suspending the collection of excise taxes or VAT on oil and petroleum products,” he said.
Romualdez said he wants to talk to canned goods and basic food manufacturers, and the supermarket association after they said prices of common goods might go up amid the series of oil price hikes, which have been going on for 11 consecutive weeks.
“We will attempt to convince them to at least postpone their plans, if there are any, until after Christmas in the spirit of the Yuletide season,” Romualdez said. “We understand that they (oil players) are also affected. But we will appeal to their sense of compassion and ask them if they can find a way to manage until Christmas.”
But oil company officials who spoke on condition of anonymity said pump prices must be determined by market forces.
“The oil company prefers lower prices because the working capital goes up if prices are high. Interest rates and costs to operate have gone up today,” a company official said.
Another oil executive addressed allegations that the oil companies are selling old stocks at higher prices.
“How do you answer this if the reverse [is true]? So old stocks acquired at a high price must also be exhausted? In other words, it’s impossible to implement. Market forces are the ultimate determinant of price. That’s why it’s called deregulated,” the source said.
Another official from an independent oil player said they do not carry months’ worth of stocks.
“We have very fast turnarounds of 7-14 days in stock. The price offuel is also quite expensive. Pricing is dictated by the average Mean of Platts Singapore and that changes daily,” the source said.
Also over the weekend, the Alliance of Transport Operators and Drivers Association of the Philippines (ALTODAP) said some public utility vehicle (PUV) drivers and operators have not yet received their fuel subsidies from the government.
In an interview with radio dzBB, the association’s president Boy Vargas said he is planning to meet with Transport Secretary Jaime Bautista and Land Transportation Franchising and Regulatory Board (LTFRB) chairman Teofilo Guadiz III to discuss the fuel subsidy.
