Oil firms asked to freeze price increases

BY DENNIS GADIL

SENATORS yesterday appealed to giant oil companies to hold off any planned price adjustment in the coming weeks to give relief to the public who have to bear annual school opening woes like tuition fee increase and soaring prices of school supplies.

Gasoline, diesel and kerosene prices have risen 11 times since the start of the year for a total of P7 a liter for gasoline and P6.50 for diesel and kerosene.

The cost of unleaded gasoline is now at the record high of P51.07 a liter.

Oil executives have said they have to recover some P7 billion in losses because of skyrocketing world crude prices, which is now pegged at $115.46 per barrel as per Dubai crude market.

Senate President Manuel Villar said prices of school supplies and even tuition normally go up during the start of the school year, but this time the hikes could be higher because of the skyrocketing oil prices.

He said the recently issued salary increase and the 50-centavo increase in fare announced by the Land Transportation Franchising and Regulatory Board yesterday would drive the prices of basic commodities to further go up.

For one, he said, private schools and universities will have to factor in the P20 wage hike ordered by wage board last Friday in the monthly payroll of their teaching personnel and workers by reflecting it their cost of operations like tuition. The wage order takes effect next month.

"I appeal to oil companies to help keep our children in school by moderating their profit margin in the coming weeks or until the school opening season," Villar said.

Villar has been calling for price transparency among local oil players in relation to their price-fixing and loss recovery formula.

He said oil companies could not always pass on all their losses to the consumers.

TRIPLE WHAMMY

Sen. Alan Peter Cayetano said the weekly adjustments in oil prices are a "triple whammy" on consumers.

A price freeze, he said, would help ease the pressure on prices of basic products and services going up during the school year opening.

"Because oil price hikes result to higher transportation cost (and to) higher energy cost, higher prices of basic commodities and other prices also have to be upwardly adjusted including wages," he said.

"Schools will then have to raise tuition fees or save on other items which would affect quality of education," he added.

Cayetano took government to task for what he said was its lack of serious effort to rein what he called the greed of oil companies while going all out against a dominant power retailer like the Manila Electric Co. (Meralco).

"Why isn’t the government (being) aggressive in checking the abuses oil companies and making their books more transparent?" he asked.

Cayetano, chairs the Senate blue ribbon committee, said he is baffled over the oil companies’ glowing sales figures and claims of losses which they recover by increasing prices.

OIL PRICE CAP

Pangasinan Rep. Jose de Venecia proposed at a major energy forum in Moscow that the world’s oil producers put a cap on soaring oil prices.

"The danger is real that high oil prices could cause overburdened economies to collapse, setting off a series of debt-service defaults that could trigger a global financial crisis," he said at the Asian Integrated Energy Market forum organized by the Asian Parliamentary Assembly.

His proposal was included in the communiqué at the end of the two-day forum presided by the vice president of the Russian Duma (parliament), Valeriy Yasev, one of Russia’s foremost oil experts.

De Venecia said the six oil-rich states of the Gulf Cooperation Council might be moved to put a cap on oil prices as a "gesture of solidarity" with the oil-poor countries of Asia, Africa and Latin America.

The Council is made up of Saudi Arabia, Bahrain, Kuwait, Oman, Qatar and the United Arab Emirates.