By Myrna M. Velasco
Energy Secretary Alfonso G. Cusi has sought the imprimatur of the Cabinet for the amendments the Downstream Oil Deregulation Act to force “reluctant” oil firms to make their weekly oil price adjustments transparent.
“We discussed that in the Cabinet and proposed to review the Oil Deregulation Law because we need to have more transparency and really know how to price it,” the energy chief said.
Energy officials have indicated that when the oil companies were served with show-cause orders (SCOs) to explain their lower-than-expected rollbacks last September 30, the responses given by the industry had been more of “hazy assertions” that since it is a deregulated market, they are not bound to provide specific details relative to their products’ pricing.
Nevertheless, Energy Undersecretary Felix William Fuentebella emphasized that they are reviewing their next legal steps on the SCOs – especially with respect to the fuel price unbundling cases that are pending with the Courts.
He confirmed though that the explanations of the oil companies were just regurgitation of the same arguments they already set forth in the cases on the legally questioned fuel cost unbundling policy.
Beyond the call for more transparent pricing, Cusi emphasized that the department will also be seeking explanation from the oil companies as to the wide variations of prices across jurisdictions – since this is a common question raised by many local government officials.
“There is a price difference. I want that price difference to be unbundled. If I cannot unbundle the whole of the price, I want to unbundle the difference,” Cusi said.
On the proposed modifications in Republic Act 8479 or the oil deregulation law, the energy chief stipulated “I believe that the Cabinet is with us because it is the interest of the people that is at stake.”
With the dictum of market deregulation or liberalization in the downstream petroleum sector, the oil companies had already grown most comfortable of just providing general assertions as to the cost-drivers of their weekly cost movements at the pumps.
The industry players are also hiding under the “cloak of confidentiality” when asked on general details of international price swings – with them noting that their subscriptions with the Mean of Platts Singapore (MOPS) are covered with non-disclosure agreements.
And given their uniform price adjustments on a weekly basis which they just simply attribute to “market forces”, the consumers and even the media are helpless when it comes to extracting further information from them – aside from them just shoving the usual advisories of price adjustments.